Small Business Glossary

Commonwealth Financial Claims Scheme

The Commonwealth Financial Claims Scheme (FCS) is an Australian Government program that safeguards deposits and certain insurance policies in the unlikely event of a financial institution failing. It acts as a safety net for consumers.

How does the Commonwealth Financial Claims Scheme (FCS) work?

  • Protects:
    • Deposits held with authorized deposit-taking institutions (ADIs) like banks, building societies, and credit unions incorporated in Australia. Coverage is up to $250,000 per account holder, per ADI.
    • General insurance policyholders and claimants – up to $5,000 per policy, with eligibility for higher amounts under specific circumstances.
  • Activation: Only comes into effect if the Australian Government triggers it when a financial institution fails.
  • Administration: Managed by the Australian Prudential Regulation Authority (APRA) once activated.
  • Goal: Aims to return protected deposits to account holders within seven days of activation.

More information on the Commonwealth Financial Claims Scheme (FCS)

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