natwest isa 7.32%

oxfox

runciblespoon wrote: »

CSA seemed very clued up about the product and answered my questions with only a brief recourse to the manual

Good job! Did they happen to say anything about opening a savings account with the same branch at the same time? My (fairly clueless) local branch decided I didn't need to - but that was probably because I was still there 10 minutes after they'd locked up (due to their to-ing and fro-ing)! I'd hate to have "got in first" only to have the application rejected because of this.

tiptoe_mouse

YorkshireBoy wrote: »

AER is a purely illustrative figure. That's why all statements contain the words "would be", ie...

"This is a notional rate used for interest bearing accounts which illustrates what the gross credit interest rate would be if paid and compounded on an annual basis."

Although annoying when used on accounts such as these, there's nothing illegal about it.

My point is that if you make a transfer, and leave the money there for one year, you cannot get the advertised AER. Therefore the AER is wrong. I make it 7.19% AER for 11 months at 7.13% and 1 month at 5.13% (highest tier). Even lower if the request takes longer than 1 month.

As a comparison, look at the First Direct ISA rates, as discussed earlier. The AER is lower than the Gross to take account of the fact that you cannot achieve 6.125% for a whole year.

tiptoe

YorkshireBoy

tiptoe_mouse wrote: »

My point is that if you make a transfer, and leave the money there for one year, you cannot get the advertised AER. Therefore the AER is wrong.

Things are further complicated by the response to runciblespoon's questioning this morning (see above post), because s/he was told the bonus starts from the date they receive the cheque...not from the date they receive the transfer form. All of which means it probably *is* possible to earn 7.32% AER.

Maybe they've simply poorly worded the details on their website?

Assuming it isn't possible to earn 7.32% AER, do you feel strongly enough on the AER issue to write a letter of complaint to NatWest/BBA/OFT/FSA/etc?

runciblespoon

oxfox wrote: »

Good job! Did they happen to say anything about opening a savings account with the same branch at the same time?

I didn't ask. I'm just popping off to a branch now so we'll see what happens

COCO

I have been to another larger Natwest branch this morning, to find no one there new anything about the new isa offer, so they arranged for someone to ring me at home.


Just recieved the call and the first person i spoke to could not answer even the basic questions i had about the product.

The second person i spoke to thought i was enquiring about an RBS isa !.

Lastly the third person seemed to know a little about it, saying the interest is paid monthly with the bonus, there are no penalties for withdrawals or transfers and wait for it, it will all take about a week to complete!!!.....................................................................sorry just fell of the sofa laughing.


All in all I'm not surewhat to do now, keep it in ICESAVE or try to get some more info from the Natwest comedy club.:rotfl:

tiptoe_mouse

YorkshireBoy wrote: »

Things are further complicated by the response to runciblespoon's questioning this morning (see above post), because s/he was told the bonus starts from the date they receive the cheque...not from the date they receive the transfer form. All of which means it probably *is* possible to earn 7.32% AER.

Maybe they've simply poorly worded the details on their website?

Assuming it isn't possible to earn 7.32% AER, do you feel strongly enough on the AER issue to write a letter of complaint to NatWest/BBA/OFT/FSA/etc?

Their website seems pretty clear cut:

Bonus is for customers transferring in Cash ISA funds from another provider (excludes transfers within the RBS Group) and is calculated on the whole balance in the account for 12 months from receipt of the Cash ISA transfer request. Interest is paid tax free and is paid monthly to the account. The bonus interest will be paid monthly along with the standard interest payment.

(my emphasis)

It seems deliberately worded to avoid them having to pay the higher rate for the full 12 months. If they realise that it's going to be costly, all they have to do is "lose" a few transfer cheques for a couple of months.

I would welcome other people's views as to who I should take this to. I'm sure it counts as misleading advertising at the very least.

tiptoe

Dikka_3

shazkhan111 wrote: »

why has this gone unnoticed

http://www.natwest.com/personal/savings/g2/isas/cash-isa.ashx#tabs=section2

It looks worth a punt as long as you remember to change again after the 122 months bonus period - I am going to give it a go !!:beer:

brookerbabyisababy

I'm still confused whether to transfer my First Direct ISA? What is the rate difference between the two?

Milarky

runciblespoon wrote: »

1. The bonus rate starts from the day the cheque is received from the old ISA provider, so there's no loss of bonus while waiting for it. Obviously if you pay in cash then the bonus will start straightaway.

As per tiptoe_mouse's post above, this simply means they start paying interest from when they receive the money. It has no bearing on the duration of the bonus period... from when a transfer request is received - not the transfer itself.

tiptoe_mouse

Update:

I've rechecked my calculations, and it appears that Natwest are making some allowance for transfer time in their AER - just not enough.

If you convert the 5.13% gross monthly rate into an AER you get 5.25% as expected. But 7.13% converts into an AER of 7.37% not 7.32%. 11 months at 7.13% followed by one month at 5.13% gives an AER of 7.19%.

So a bit of fiddling with numbers gives:

11.75 months at 7.13% followed by 0.25 months at 5.13% gives an AER of roughly 7.32%. Or in other words, Natwest are allowing a week for the transfer to go through in their calculations of the AER.

tiptoe