Brit expatriates still fearful no-deal will prevent access to funds

Published:  15 Mar at 6 PM
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As Britain’s parliament continues to demonstrate its appalling inefficiency amidst total chaos, fear and uncertainty still stalks British expat investors in Europe.

Although the risk of a no-deal Brexit now seems to be up to European lawmakers, its impact on both British expats overseas and UK citizens in general is still a cause for extreme concern if not out-and-out panic, especially where financial matters are concerned. In spite of yesterday’s vote to reject no-deal, it’s still the default option if May’s despised agreement isn’t voted in at some time in spite of the fact that the financial industry is urging its avoidance at all costs.

Ratings agency Moody’s are predicting inflation, a disaster for savers whose meagre interest rates aren’t covering the rise in costs already taking place. The only way to get a decent interest rate is to lock savings away for decades, an option which isn’t the best idea for returning expats, basic-wage earners and those nearing retirement. For Britons determined to remain in their chosen EU homes, the risk of not being able to access either their pensions or their savings is causing increasing concern. Britain’s Financial Conduct Agency has already offered the ability to keep trading in the UK following a no-deal Brexit, but the EU hasn’t seen fit to offer the same in reverse, with a recently-issued government paper stating EU-based clients of UK companies may lose both deposit and lending services.

At the present time, a good number of foreign financial firms are trading in the UK via ‘passporting’, with some offering competitive interest rates for savers, but a no-deal exit from the EU could mean the death of the FCA’s guaranteed protection against losses caused by bankruptcy. It’s just possible that a no-deal Brexit would force banks to come up with better savings rates in order to keep existing customers, as financial institutions rely on deposits as a handy source of cash for lending as mortgages and other loans. A scenario in which nervous British investors begin to withdraw their funds might well spur banks to increase their rates in order to keep reluctant savers happy. Even so, a spokesperson for the financial trade body is assuring investors they’re still working with the UK government to ensure a managed Brexit including putting in place contingency plans minimising consumer disruption should it all fall apart.
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