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New rules coming into force next month mean customers at UK banks will now have more of their money protected if their financial provider goes under. The new rule affects anyone with less than £120,000 in their bank account.

As of December 1, up to £120,000 of your cash will be returned to you if a UK-authorised bank, building society or credit union goes out of business . This is up from the current cap of £85,000, which had been in place since 2017.

The limit applies under the Financial Services Compensation Scheme (FSCS) and the higher level was confirmed today by the Prudential Regulation Authority (PRA), the Mirror reports .

The compensation limit applies per person, per authorised firm, and is usually paid automatically within seven days of the firm going bust.

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