Icesave depositors will soon be reunited with their cash.
Savers with deposits tied up in Icesave have begun receiving emails informing them of the steps they need to take to claim back their money. Some 230,000 UK consumers have been affected by the collapse of the online bank, which closed at the beginning of October when its parent company - the Icelandic bank Landsbanki - was nationalised.
All savers will receive communications from the Financial Services Compensation Scheme (FSCS) which will explain how the compensation process works. Starting next week, they will then receive a second email giving instructions on how and when to transfer their money across to a linked account electronically. This second phase will be carried out in stages.
Under the terms of the compensation scheme, savers with cash in an Icesave Isa will be able to move it to a new account with an alternative provider without losing the tax-free status of their deposits. They will also receive any interest due on their savings up to October 7th, when Landsbanki went into default.
Prior to its collapse, Icesave was offering rates of up to 6.30 percent on its easy access savings accounts and Isas and up to 7.06 percent on its fixed rate savings accounts.
The FSCS said it hopes compensation can be paid to the "vast majority" of Icesave depositors by the end of this month. It is also warning customers to beware of illegal phishing attacks, insisting that it will not be contacting people by phone or by email to request bank account details.
