You are here: Home - Saving & Banking - News -

‘No deal’ Brexit: the impact on your money

0
Written by: Paloma Kubiak
23/08/2018
The government has today published a series of guides outlining what would happen in a ‘No deal' Brexit scenario. Here are the most important points for consumers.

A speech on planning for a ‘No deal’ Brexit scenario was given today by Brexit secretary, Dominic Raab.

Within the speech, he said he is confident that the UK will get a good deal, but it was prudent for the government to plan for the unlikely event that the UK does not reach a negotiated deal with the European Union.

So far around 80% of the Withdrawal Agreement has been agreed ahead of the 29 March 2019 exit deadline, but Raab outlined the following scenarios in the case of a no deal:

Card payment charges

In January 2018, ‘rip-off’ credit card surcharges were banned, meaning retailers are no longer able to charge up to 5% for paying with a credit card rather than debit card or cash.

But today’s technical notes stated: “The cost of card payments between the UK and EU will likely increase, and these cross-border payments will no longer be covered by the surcharging ban (which prevents businesses from being able to charge consumers for using a specific payment method).”

Access to deposits and pensions

UK expats may lose the ability to access existing lending and deposit services, insurance contracts, such as life insurance as well as annuities because UK firms lose their rights to passport into the EEA, which impacts customers accessing the services.

‘Passporting’ allows firms in any European Economic Area (EEA) to carry out activities in any other EEA country. If they’re authorised in one member state, they can provide services to customers in other member states without having to gain authorisation from the local regulator.

The notes read: “For example, the UK is a major centre for investment banking in Europe, with UK investment banks providing investment services and funding through capital markets to business clients across the EU. In the absence of EU action, EEA clients will no longer be able to use the services of UK-based investment banks, and UK-based investment banks may be unable to service existing cross-border contracts.”

But in a ‘No deal’ scenario, the government said it is looking to bring in a temporary regime allowing firms currently passporting into the UK to continue operating in the UK for up to three years after exit, while they apply for full authorisation from UK regulators.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Flight cancelled or delayed? Your rights explained

With no sign of the problems in UK aviation easing over the peak summer period, many will worry whether holida...

Rail strikes: Your travel and refund rights

Thousands of railway workers will strike across three days this week, grinding much of the transport system to...

How your monthly bills could rise as the base rate reaches 1.25%

The Bank of England has raised the base rate to 1.25% as predicted – the fifth consecutive rise in just six ...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week