Icesave Fixed Rate Account FSCS Option

isofa

KenC wrote: »

I see what you mean though. Do you think they may fast track for those deposits that have matured? I don't think they would.

I doubt it, but in the future, they'll be less maturing at once (many staggered across months and years) so maybe then it won't be such a slow procedure, but I have my doubts...

If I had one maturing imminently, I'd probably take the cash and run! However I don't, so I'm happy to leave it at a high rate.

sloughflint

isofa wrote: »

That's what I would have thought normally... but these aren't normal circumstances, if you are letting the term account run to maturity, you cannot benefit from the partial interest paid (which we didn't request) on 10-10-08, as you cannot access it early...

For those that held monthly paying accounts and chose to have interest paid into their accounts on a monthly basis, that interest could not be accessed either ( unless they opted for interest to be paid into an external account). Interest was still counted for that particular financial year.

I'm even more convinced that the normal rules apply ie it's when interest is credited that counts.Ability to access is irrelevant.

isofa wrote: »

Hence my discussion point.

KingL wrote: »

...for now

From the first email:

You should also be aware that if you hold a fixed rate savings account that pays interest on a monthly, quarterly, or annual basis, and you decide to hold that account until maturity, you will not be paid any interest prior to maturity.

FWIW,I can't imagine that the part payment to 7/10 would be removed.

Thinking about monthly interest paying accounts, if they did remove the extra payment up to 7/10,would they then also remove all the earlier monthly interest payments credited to the account? I doubt it so reckon that all interest credited to date will remain and count for FY 08/09

EalingSaver

Don't jump down my throat, this is no criticism of anyone.

I'm a believer in minimising ones tax liabilities. But just cast yourselves back a month or so ago. I don't know about you, but I was worried as hell that I was potentially gong to lose the first £16k of my savings with IceSave, and that my OH would too (her entire savings pretty much). And I'm sure there were a load of others worried about losing their first £16k and anything over £35k (and then, phew, over £50k). Not only are we getting the money back, but those with FTDs are actually going to have the original rate honoured through to the original maturity date, at a time when rates are going through the floor, which regardless of what the FSCS rules say I would suggest is well above and beyond a reasonable expectation, and there are people discussing which tax year it will fall into to minimise their tax bands (and thereby reducing their liability for the tax payers contribution to recovering their money) ???

smarmo

The question for me is this: why if we elect to leave the money in for the fixed term is there a form based process that takes six weeks to complete? What happens at the end of six weeks? I have a feeling they are making it as hard as possible to leave the money for the term (and who can blame them).

My overwhelming instinct here is to take my money and run.

nice_day

hiya,

I have Icesave Fixed Rate Deposits which matured on 24 October 2008 and 2 November 2008.
However, I have only received interest up to 10 October 2008 in both cases.

As I understood FSCS interest will be compensate also for interest up to maturity:

32. If I decide to keep my Fixed Rate Savings Account open, will I need to make my paper application now or just before my account would normally mature?
If you prefer to wait until the end of the fixed term, and receive interest which would have been due at maturity, the electronic process option is not available to you. However, you should still log on to the website and tick the appropriate box to confirm that this is your wish. At that time, we will be notified that you wish to wait until the end of the fixed term and we will then send you an application form to complete and return to the FSCS as soon as possible. This process will be slower, although we aim to complete this process so far as possible within 6 weeks of receipt of a completed application form, with payment following the maturity date of the account. You should also be aware that if you hold a fixed rate savings account that pays interest on a monthly, quarterly, or annual basis, and you decide to hold that account until maturity, you will not be paid any interest prior to maturity.

(Taken from http://www.fscs.org.uk/faq/icesave_faqs)

Does someone has any advice on this issue?

Thank you!

Baldur

Presumably, you will need to follow the paper application route indicated in your quote from the FSCS, during the claim process, your accounts should be credited with interest up to maturity.

Having said that, you potentially stand to lose 6 weeks or more of interest by following the paper application route, as your accounts matured so close to the default date.

isofa

EalingSaver wrote: »

Don't jump down my throat, this is no criticism of anyone.

I'm a believer in minimising ones tax liabilities. But just cast yourselves back a month or so ago. I don't know about you, but I was worried as hell that I was potentially gong to lose the first £16k of my savings with IceSave, and that my OH would too (her entire savings pretty much). And I'm sure there were a load of others worried about losing their first £16k and anything over £35k (and then, phew, over £50k). Not only are we getting the money back, but those with FTDs are actually going to have the original rate honoured through to the original maturity date, at a time when rates are going through the floor, which regardless of what the FSCS rules say I would suggest is well above and beyond a reasonable expectation, and there are people discussing which tax year it will fall into to minimise their tax bands (and thereby reducing their liability for the tax payers contribution to recovering their money) ???

I completely agree and it's great the Government came forth and honoured the accounts, via the FSCS, even for those with balances over any of the limits (foolish as that may seem to some). It's also blown wide open the frailty of the "passport" scheme.

However the government have done some very back door dealings with other Icelandic banks such as KE, effectively causing it to fold rapidly, not to mention recommending and rating Iceland in the first place (even when it appears a long time ago they had some serious warnings). Where the money eventually comes from is a moot point, it may not be tax payers money at all.

I pay enormous amounts of tax like many of us. And locally where I live have seen it frittered away year after year on crazy schemes, millions wasted with local authorities and the like. I'm sure many of us have similar experiences.

My points were for discussion as many peoples tax affairs are more complex, and they need to sort out early what's coming in from where, if suddenly more money than expected has arrived, they need to plan for this, I did think this was MoneySavingExpert

It certainly wasn't a criticism of the payout process nor the guarantee, which I've never made.

bryanb

smarmo wrote: »

The question for me is this: why if we elect to leave the money in for the fixed term is there a form based process that takes six weeks to complete? What happens at the end of six weeks? I have a feeling they are making it as hard as possible to leave the money for the term (and who can blame them).

My overwhelming instinct here is to take my money and run.

See post 91 for their recent clarification.

Nervous_Norvus

My guess is that maintaining a web site to support savings accounts costs pretty much the same regardless of how many users there are. That is why if there are many savers it gets very cheap to run.

Therefore FSCS have probably decided that after the initial rush, it is cheaper to operate a paper based process. For those who have bonds maturing a long time hence it seems sensible to opt for the paper based process. Possible problems would then presumably be the same as with any postal account (forms/cheques going missing etc).

For sure, take a copy of your application form and send it recorded delivery. Anyone else have a view on this?

Nervous_Norvus

Icesave website does tell you that payment on the paper based system will be by cheque.

Also, if anyone has received a form, and can scan it, could they post an image of it (BEFORE completing it, obviously ;-)