Since the collapse of the Silicon Valley bank, many, including you, have wondered: Is my money safe? On Twitter, many users are expressing concern and want to know if they should withdraw their assets as a precautionary measure.
For example, this tweet: “We all need to pull everything out of our bank accounts to protect our money. I’ve convinced my entire family, a few friends, and co-workers that this is the most reasonable decision.”
Another user wonders if the Silicon Valley bank collapse poses a risk to European customers: “Can someone who really knows explain what exactly this means for us Europeans? Is the money in our accounts at risk? Should we take the money out?” and put it under the mattress. ?
How does the European Union protect our bank accounts?
According to Google Trends, searches for “Is my money safe” are up 43%. The good news is that since the 2008 financial crisis, regulations have been put in place to protect the money in people’s accounts. Let’s take a look at the different countries in comparison.
In the United States, the Federal Deposit Insurance Corporation insures people up to $250,000.
And what about the European Union?
- Due to EU legislation, all member states are required to put in place at least one deposit guarantee system at the national level.
- All systems must meet the EU minimum deposit guarantee for amounts up to €100,000.
This means that all EU countries must secure an amount of at least €100,000 per customer and bank. This means that if you have money in another bank, it will also be insured.
Anyone with more than €100,000 in one bank account must spread that money across to other banks to ensure it is covered by the deposit system.
In the event of a bank collapse in the European Union, customers must be compensated within 20 working days. By 2024, this period will be reduced to seven days.
In the UK, customers of banks regulated by the Prudential Regulatory Authority (PRA) are protected up to £85,000 – around €97,000.
Don’t put all your eggs in one basket
Although many countries have protection systems in place to avoid losing customer funds, experts told us the Silicon Valley bank collapse is an important reminder to be careful about where you keep your money and not put it all in one place.
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