first direct increase rate to 5.20%

Bob_Frapples_3

Couldn't see this posted anywhere but thought some people might be interested...

first direct's e-Savings Account used to pay 5.00% (same as ING) but with the clause about not getting any interest in a month that you make a withdrawal... :mad:

I saw an advert in the paper yesterday and it turns out that they've put the rate up to 5.20% (even though the base rate hasn't increased)

I called to check (you can't believe everything you read in the papers!) and yes, they have increased the rate AND they've increased the upper limit from £50k to £250k.

Not bad if you've got a big lump sum that you don't dip into all the time...

(The advert said "time for a better rate"...hmmm - better late than never..!)

ED

Thanks for the info, Bob.

5.08% gross (5.20 AER) is a step in the right direction from First Direct. Rates page is here :

http://www.firstdirect.com/rates/current.shtml

Curiously, log-in doesn't yet result in any alert to the rate rise - although during a recent log-OFF, a member of my family encountered a First Direct pop-up ad offering a loan!

5.50% gross is offered by Nottingham Bdg Soc for their Post It account. It requires 90 days' withdrawal notice, and includes a bonus for the first 12 months. (Tip : after a year, close the account via 90d w/d notice, and open a fresh Post It account.)

isasmurf

First Direct seem to be beginning to play the savings market, but are putting in some very sneaky conditions, like the no interest for making a withdrawal and limiting you to transferring just this years deposits in their e-cash ISA.

They used to be quite a distinctive bank but after years of relying on word of mouth until a couple of years ago and their excellent customer service for attracting new business, they're now beginning to be the same as every other bank. Most banks have loyalty due to apathy, but First Direct have true customer loyalty. People stay with First Direct because they want to and not because they can't be bothered to move. FD need to be careful not to alienate their loyal customers by doing what most other banks do and chase the credit card or savings market.

IMO they can never compete with the best savings banks and they should increase their current account rate instead of chasing the savings market.

ED

"they should increase their current account rate"

Excellent idea for First Direct.

If they do, customers won't have to internally transfer spare £'s from cheque account into Savings account. (At least it occurs instantly, whereas A+L do it 'overnight'.)

zx2011

More worringly the rate on the Savings Account for balances up to £499 has gone down to 0.10% AER and 0.08% NET!!!!

Milarky

....and what was also bad about that was they notified of the changes me by leaflet on 17th Feb - just four days notice!

consquently the FD savings account has been emptied and shipped out to a better account just leaving the bank account with a few quid and basically dormant. Credit now empty too after 6 months interest free balance was repaid.

ED

marcgr + Milarky - thanks for sharing this shocking news!

First Direct have just lost yet another previously enthusiastic advocate of 8 years standing!

Our family will immediately seek a different bank to handle Direct Debits, alongside an internal savings account paying a decent rate. (Ideas welcome...perhaps Norwich & Peterborough Bdg Soc?)

Elf1407

isasmurf wrote:

People stay with First Direct because they want to and not because they can't be bothered to move. FD need to be careful not to alienate their loyal customers by doing what most other banks do and chase the credit card or savings market.

I totally agree with isasmurf, Ive been with FD for about 10 years now and because of various sneaky changes and bad rates Im now considering investing/banking elsewhere - all suggestions welcome

I used to feel good about banking with them. Now they are no different from anyone else.

zx2011

I've been with First Direct for over 15 Years!!!!!

I still use them for my cheque account although I've flirted with Cahoot, Smile and Nationwide none of which I would EVER go back too :mad: !!!!!!

All my savings are now with Yorkshire Building Society's e-Saver account which pays 5.20% AER (4.16% NET)

It's a no notice account. Transfers take up to 5 days. It's also an instant access account via a LINK ATM card that allows up to £250 in cash to be withdrawn anywhere in the UK.

First Direct's offering is too confusing and complicated.

They currently offer 2 current accounts (Cheque and Bank)
7 savings accounts (Everyday Savings, Savings, Bonus Savings, E-Savings, Offset Savings, Mini Cash ISA, Mini Cash e-ISA)

When they started way back in 1989 they had just two types of account. A Cheque account and a High Interest Deposit account(HIDA). HIDA changed its name along the way and is now called Everyday Savings which also pays 0.1% up to £500. It's top rate of 1.75% for balances over £2500 isn't exactly "high" by any stretch of the imagination.

When in comes to customer service First Direct wins everytime. They still have a policy of no charges for everyday banking. Their banking representatives have the ability to sort out everything without having to be put on hold and transferred elsewhere for 99% of the time.

Unlike other direct banks you can still use any HSBC branch if needed. I understand that at least one bank(IF.COM) won't let their customers pay cheques in at their bank's own branches. On the rare occasions I've needed the help of a HSBC branch they have always been very helpful.

So my verdict is 10/10 :cool: for current accounts. 0/10 :mad: of everything else.