What is the Australian Government Guarantee?

Understanding the Australian Government Guarantee

Find out how the Australian Government Guarantee protects your money.

What is the Australian Government Guarantee?

The Australian Government Guarantee, also known as the Financial Claims Scheme (FCS), provides protection for funds deposited in eligible financial institutions up to a limit of $250,000 for each account holder.

The FCS can be activated by the Australian Government if a bank, building society or credit union fails or can’t meet its financial obligations.

How are your funds protected?

As a QBANK member, in the highly unlikely event that QBANK couldn’t meet its financial obligations, your deposits are protected up to this limit. You won’t lose this money.

If the FCS is activated, its managed by the Australian Prudential Regulation Authority (APRA) — they’ll aim to pay you back your protected funds within seven days.

What if I have more than one bank account?

The guarantee applies to combined funds of $250,000 in accounts in your name.

If you have more than one QBANK account under the same name, your funds are protected for the combined amount of $250,000.

If you have accounts in more than one bank and those institutions are covered by the FCS, then your combined funds in each separate institution are protected up to the $250,000 limit.

What if we have a joint account?

Joint account holders are protected for their equal share of the funds in the joint account. If they have other accounts in their own name, their funds are protected up to the combined $250,000 amount.

Michelle and Max

Michelle and Max Peterson have a QBANK joint account containing $150 000.

Michelle has two other QBANK accounts in her name containing a total of $80,000, and Max has an account in his name containing $60,000.

If the FCS is activated, Michelle and Max would be covered for their equal share of the joint account, amounting to $75 000 each. This split amount would then be combined with the amount in their separate accounts — Michelle is protected for a total of $155,000 and Max for his combined amount of $135,000.

Does the guarantee cover business accounts?

Business accounts are treated the same as other accounts. Accounts held by a sole trader are considered to be the same as an individual account holder — and assessed against the guarantee with other accounts held at the same financial institution.

If your business accounts are held in more than one individual’s name they are treated like ordinary joint accounts — the funds within the joint business account will be split evenly among the individual account holders as part of combining their accounts up to the $250,000 limit.

What about mortgage offset and redraw accounts?

Mortgage offset accounts which are separate deposit accounts are covered by the guarantee.

Funds held in mortgage accounts with a redraw facility are not protected.

Is my superannuation protected?

Self-managed super funds held in an eligible financial institution are protected by the guarantee. But if a super fund deposits funds in a protected account with QBANK, the super fund is considered the account holder, not the individual.

Funds held in Retirement Savings Accounts (RSA) are also covered by the guarantee.

For more information, visit the Australian Government Guarentee page on our website.

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