Post Office Online Saver Interest Rates

dosh37

I opened a Post Office Online Saver account in January this year with an initial interest rate of 2.9% (1.25% bonus for 1 year).

Since then, the Post Office have gradually reduced the interest rate to 2.75% without notifying existing customers.
Now they have introduced a new Online Saver (Issue 4) with an interest rate of 3.01% (1.36% bonus for 1 year).

This clearly a deliberate policy to squeeze as much out of existing customers as possible.:mad:

After becoming wise to this, I have just opened a new Issue 4 account and intend to transfer funds from the old account ASAP.:idea: You can do this easily online. I suggest anyone with one of the older accounts does the same.

I wonder how many existing cusomers will stick with their existing account - either because they are not aware that the rate has dropped or because of the effort in opening a new account? :think:

The difference may only be a mere 0.26%, but if you add this up for all the existing customers, I bet it amounts to a few million pounds extra for the fat cats.

MoneySaverLog

This is common, not just with the post office but with banks too.

Often accounts will have issue numbers attached to them but keep the same name so unless you keep track of both you wont know. Banks should inform you about rate changes though, this could just be an announcement in the branch. But be honest when was the last time you went into a branch to look for this.

*cassius*

i started the online saver with the post office in november 2010 and noticed last week that the rate had dropped, the post office site site does state that they will notify customers via the website but this would involve you constantly checking the interest rate amount.

i have found a saving scheme with my work that offers 4% a year and now that the rate has dropped with the post office i think ill move all my money into that over the next few months as cannot be bothered constantly setting up new online savers everytime the rate drops, ill keep the account open and wait for the interest in march before closing it

anamenottaken

*cassius* wrote: »

i started the online saver with the post office in november 2010 and noticed last week that the rate had dropped, the post office site site does state that they will notify customers via the website but this would involve you constantly checking the interest rate amount.

i have found a saving scheme with my work that offers 4% a year and now that the rate has dropped with the post office i think ill move all my money into that over the next few months as cannot be bothered constantly setting up new online savers everytime the rate drops, ill keep the account open and wait for the interest in march before closing it

If you can find a better rate (eg the new PO issue), why not close it now and get your interest earned to date?

Milarky

dosh37 wrote: »

I opened a Post Office Online Saver account in January this year with an initial interest rate of 2.9% (1.25% bonus for 1 year).

Since then, the Post Office have gradually reduced the interest rate to 2.75% without notifying existing customers.
Now they have introduced a new Online Saver (Issue 4) with an interest rate of 3.01% (1.36% bonus for 1 year).

This clearly a deliberate policy to squeeze as much out of existing customers as possible.:mad:

I don't follow. The old rate was 2.9% with 1.25% bonus - so the underlying rate was 1.65%. Now (you claim) that rate is '2.75%' but the PO offer a new account @ 3.01% including a bonus of 1.36% - that would make the underlying rate... still 1.65%!

Can you post figures showing the underlying rate is less than 1.65%?

(Nope!)
http://www2.postoffice.co.uk/finance/savings-investments/online-saver

*cassius*

would they automatically include the full amount of interest earned to date if i sent a closure letter this week ?

also the post office page has changed again because of the new online saver being promoted, only a couple of days ago it was advertised at 2.75% for the online saver 3 so dosh37 isnt seeing things but your right in that the underlying rate shouldnt have dropped but it was showing 2.75%

atypical

*cassius* wrote: »

would they automatically include the full amount of interest earned to date if i sent a closure letter this week ?

Yes they would.

Sceptic001

Milarky wrote: »

I don't follow. The old rate was 2.9% with 1.25% bonus - so the underlying rate was 1.65%. Now (you claim) that rate is '2.75%' but the PO offer a new account @ 3.01% including a bonus of 1.36% - that would make the underlying rate... still 1.65%!

Can you post figures showing the underlying rate is less than 1.65%?

(Nope!)
http://www2.postoffice.co.uk/finance/savings-investments/online-saver

Milarky is right. The underlying rate has not changed since October 2010, so if you were getting 2.9% you are still getting 2.9%.

In fact, the Post Office did notify account holders by email the last time their underlying rate changed. OK, it was an increase, so it will be interesting to see if they do the same if it falls, but so far they have played it straight on their rates.

Mr_K

Putting aside their games with interest rates, I closed my Online saver a while ago. Not impressed with the level of customer service. Also no faster payments in or out, debit card payments that take days to be credited, and the Bank of 'dodgy' Ireland behind it.

ChopperST

I noticed this too and moved my Nov 2011 account to the new issue 4 to get the 2.97 AER (I opted for the monthly interest option). Very straightforward to apply online as an existing customer, you just transfer your current funds across to the new account and that acts as your initial deposit and opens the account immediately online. I intend to keep it till I have sufficient to put in a Lloyds vantage account. Like the others I am also worried about the fact it is linked to Ireland and if things did go posterior over mammary over there.

whu

dosh37 wrote: »

I opened a Post Office Online Saver account in January this year with an initial interest rate of 2.9% (1.25% bonus for 1 year).

Since then, the Post Office have gradually reduced the interest rate to 2.75% without notifying existing customers.
Now they have introduced a new Online Saver (Issue 4) with an interest rate of 3.01% (1.36% bonus for 1 year).

This clearly a deliberate policy to squeeze as much out of existing customers as possible.:mad:

After becoming wise to this, I have just opened a new Issue 4 account and intend to transfer funds from the old account ASAP.:idea: You can do this easily online. I suggest anyone with one of the older accounts does the same.

I wonder how many existing cusomers will stick with their existing account - either because they are not aware that the rate has dropped or because of the effort in opening a new account? :think:

The difference may only be a mere 0.26%, but if you add this up for all the existing customers, I bet it amounts to a few million pounds extra for the fat cats.

I have opened up the version 4 and transferred money from the existing online saver account - very simple and easy