How to Protect Your Money While Banking Overseas
Researched and drafted with AI assistance from published sources; published by NorwegianSpark SA, founded by Thomas Lovas Lokoy · Last updated: October 16, 2026
To protect money you hold abroad, find out which licensed entity holds it and which country's deposit scheme covers that licence, keep each balance under that scheme's limit per licence, check whether the scheme covers the currency you hold, and keep a second account so a frozen or unreachable account does not leave you stranded. The rest of this guide explains each of those steps, with the limits and currency rules taken from the schemes' own pages and a worked example of a typical expat setup.
There is a sentence that does a lot of damage in international banking, and it is this one: "my money is protected up to a hundred thousand." It is usually said by someone who has read the rules of the country they live in, about an account held in a country they do not.
Deposit protection does not follow you. It follows the licence. Which scheme covers your money, up to what amount, and in which currency, is decided by where the institution holding it is authorised — not by your passport, not by your address, and not by which app you opened it in. Get that one relationship right and most of the rest of this article is detail.
The four questions that decide whether you are covered
Before anything else, answer these about the specific account:
- Which legal entity actually holds the money, and in which country is it authorised?
- Is that entity a bank, or an electronic money or payment institution?
- Which scheme covers it, and to what limit?
- Is the currency you are holding inside that scheme, or outside it?
Most people answer the first two by looking at the app icon. The answer is in the terms, usually in a single line naming the entity and its regulator, and it frequently is not the brand on the icon.
Limits, as published by the schemes themselves
| Where the institution is authorised | Scheme | Limit as published |
|---|---|---|
| European Union | National scheme under the Deposit Guarantee Schemes Directive | EUR 100 000 for the aggregate deposits of each depositor |
| United Kingdom | FSCS | GBP 120 000 per eligible person, per firm, where the firm failed after 30 November 2025 |
| United States | FDIC | At least USD 250 000 at each FDIC-insured bank |
| Australia | Financial Claims Scheme | AUD 250 000 for each account holder at each bank |
| Singapore | SDIC Deposit Insurance Scheme | SGD 100 000 in aggregate per depositor per Scheme member |
Two things about that table matter more than the numbers.
First, the UK figure moved. FSCS protection was GBP 85 000 from 30 January 2017 until 30 November 2025, and GBP 120 000 applies where the firm failed after that date. If you are reading an older guide, or working from memory, you are working from the previous number. This is exactly why we check the scheme's own page rather than quoting the figure everyone knows.
Second, every one of these is per depositor per institution, and "institution" means the banking licence, not the brand. Two brands sharing one licence share one limit. If you deliberately split money across providers to stay under a limit, you have to check the licence, or you have not split anything.
The currency trap
Deposit protection is not always currency-blind, and this is where holding money abroad quietly diverges from holding it at home.
Australia's Financial Claims Scheme states it plainly: "The FCS does not apply to deposit accounts with funds in foreign currencies." A resident holding AUD is covered. The same person, at the same bank, holding USD in a foreign-currency account, is not.
Other schemes take different positions, and some cover foreign-currency deposits but pay compensation converted into the local currency at a date the scheme chooses — which means the amount you get back is subject to an exchange rate you do not control. If you hold a non-local currency in a foreign account, this is the single question to ask the scheme directly, and it is almost never answered on the bank's marketing pages.
Here is how the schemes in the table treat it, from their own documents:
| Scheme | Foreign-currency deposits | What you are paid in |
|---|---|---|
| EU schemes (Directive 2014/49/EU) | Within the EUR 100 000 limit | Article 6(4) lets each country choose: its own currency, the currency of your residence, euro, the account currency, or the currency where the account is held; you must be told which |
| UK FSCS | Counted towards the limit | FSCS's guidance to banks has balances in other currencies converted into sterling for the compensation calculation |
| Singapore SDIC | Not covered: "The DI Scheme does not cover foreign currency deposits" | Not applicable |
| Australia FCS | Not covered: "The FCS does not apply to deposit accounts with funds in foreign currencies" | Not applicable |
The practical consequence: a US dollar balance at a bank in Singapore or Australia has no scheme behind it at all, and a US dollar balance at an EU or UK bank may come back to you in euro or sterling, at an exchange rate you did not pick.
A worked example: one expat, four accounts
Take someone who lives in Spain and holds:
- EUR 130 000 at a Spanish bank
- GBP 100 000 at a UK bank
- USD 20 000 at a Singapore bank
- USD 50 000 in a US dollar account at a German bank
Working through the rules above:
- Spanish bank. The EU limit is EUR 100 000 per depositor per bank, so EUR 130 000 - EUR 100 000 = EUR 30 000 is not covered.
- UK bank. GBP 100 000 is under the FSCS limit of GBP 120 000, so it is covered in full, as long as no other account at the same banking licence takes the total over GBP 120 000.
- Singapore bank. SDIC does not cover foreign-currency deposits, so all USD 20 000 is uncovered, even though the same person's Singapore dollar balance would be insured up to SGD 100 000.
- German bank, US dollar account. Covered within the EUR 100 000 limit, but repayment may be in euro. At the ECB reference rate on 16 October 2026 (1 EUR = 1.1253 USD), USD 50 000 is about EUR 44 433. If the scheme repaid in euro and the dollar later strengthened, converting back would give fewer dollars than you deposited.
Total uncovered: EUR 30 000 plus USD 20 000. Two simple changes close most of that gap: move EUR 30 000 to a second bank with its own licence, and hold the Singapore balance in Singapore dollars or move it to a scheme that covers foreign currency. For choosing where to hold money as an expat in the first place, see best bank accounts for expats, and for each country's regulator, the global banking regulation guide.
Bank versus e-money: the distinction that catches everyone
The apps people actually use abroad are frequently not banks. They are electronic money institutions or payment institutions, and the difference is not a technicality.
The UK's Financial Services Compensation Scheme states it flatly: "We can't protect the money you have with e-money institutions and payment providers." The Financial Conduct Authority puts the same thing to consumers directly: "If your non-bank payment provider goes out of business, your money won't be protected by the Financial Services Compensation Scheme (FSCS)."
What you get instead is safeguarding. The FCA describes the mechanism: "To safeguard properly, EMIs and APIs must either put your money in a separate safeguarding account with a bank, or protect it with an insurance policy or similar guarantee." Under the EU's electronic money regime the equivalent duty sits in Article 7 of Directive 2009/110/EC, alongside Article 11, which requires issuers to issue electronic money "at par value on the receipt of funds" and to redeem it "at any moment and at par value" on request.
Safeguarding is a real protection and it is not nothing. It is also not the same protection, and the difference shows up at the worst moment. The FCA is candid about the outcome: "if they go out of business, you should get most of your money back. But it may take some time to receive, and it may not be the full amount, as some costs could be taken by the administrator or liquidator of the firm." FSCS makes the same point about timing: "Your money could be tied up for a while during the insolvency process."
Compare that with a covered bank deposit, where the scheme's whole design goal is speed and the full amount. Same balance on screen. Entirely different experience if the entity fails.
We go deeper into the mechanics in who actually holds your money at a neobank.
What to do with this, practically
The part nobody wants to hear
Splitting money across institutions to stay under protection limits is sound, and it is also the point at which people over-engineer. Six accounts in five countries is not six times safer than one well-chosen account. It is six sets of terms, six tax-reporting relationships, six sets of login credentials and six chances to be locked out of something on a Sunday.
The honest counter-argument to this whole article: for most readers, the largest realistic risk is not that a licensed institution fails. Failures are rare and the schemes exist precisely because they are foreseeable. The larger risk is losing access — a frozen account, a lost device, a compliance review that runs for weeks — which no deposit guarantee addresses at all. We wrote the app-only bank outage backup plan for exactly that gap, and it is probably the more useful page for a reader with an ordinary balance.
Protection limits matter most when the balance is large. Access matters every single week.
Regulatory verification, done properly
A scheme only covers institutions that are actually in it, so the register is the thing to check — the regulator's own public register, reached by typing the regulator's address yourself rather than following a link from the institution. Cloned-firm fraud works precisely because a fake site can copy a genuine firm's registration number, and the only defence is starting from the regulator rather than from the firm.
If you cannot find the entity on a register you reached independently, that is the answer. Do not deposit. Our five-minute bank safety check walks through the register search step by step.
Frequently asked questions
Is my money protected if I bank in another country?
Usually, if the institution is a licensed bank, but by that country's scheme and limit, not your home country's. The licence decides the scheme, not your passport or address.
Are foreign-currency deposits covered by deposit insurance?
It depends on the scheme. EU schemes and the UK FSCS count them towards the limit, while Singapore's SDIC and Australia's FCS do not cover foreign-currency deposits at all.
Is money in an e-money app protected like a bank deposit?
No. E-money and payment institutions safeguard customer money, but the FSCS states it cannot protect money held with them, and getting it back after a failure can take time and may not be the full amount.
Does splitting money across two apps double my protection?
Only if they hold separate banking licences. Two brands that share one licence share one limit.
General information, not financial or legal advice. Schemes, limits, currency treatment and eligibility vary by country and change; confirm every figure with the relevant scheme and regulator before you rely on it.
Sources
Checked 6 September 2026, except where a later date is given.
- Directive 2014/49/EU on deposit guarantee schemes, Article 6(1), text as published by legislation.gov.uk: legislation.gov.uk
- Directive 2009/110/EC on electronic money, Articles 7 and 11, text as published by legislation.gov.uk: legislation.gov.uk
- FSCS — banks and building societies cover: fscs.org.uk
- FSCS — e-money and FSCS protection: fscs.org.uk
- FCA — using payment service providers: fca.org.uk
- FDIC — deposit insurance: fdic.gov
- APRA — Financial Claims Scheme, banks, building societies and credit unions: apra.gov.au
- Directive 2014/49/EU, Article 6(4), currency of repayment (checked 16 October 2026): legislation.gov.uk
- SDIC — Deposit Insurance Scheme FAQ (checked 16 October 2026): sdic.org.sg
- FSCS — Guide to Single Customer View, January 2021, sterling conversion of foreign-currency balances (checked 16 October 2026): fscs.org.uk
- ECB — euro foreign exchange reference rates, 16 October 2026: ecb.europa.eu
