When you deposit money into a bank, the bank lends some of your savings to other customers. This is how a bank makes money! It also means your money is effectively 'at risk' if the bank goes out of business, and hence there is a need for insurance, covered by the Financial Services Compensation Scheme (FSCS), of up to £85,000.
Your Plum savings are deposited in a secure account, and held as e-Money by PayrNet (a subsidiary of Railsbank), our e-Money provider. Your money is safeguarded because e-money cannot be lent out (this is also why it doesn't earn interest), and stored in a ring-fenced account for you with the Bank of England.
That same safeguarding also prevents any of Plum's or PayrNet's creditors from claiming your money in the event that either business should go bankrupt.
Both Plum and PayrNet are regulated by the Financial Conduct Authority (the UK’s financial watchdog) to make sure of this.
In a nutshell, the money is equally safe with Plum vs your bank 🤝