MSE News: Halifax launches Premium Bond-style savings draw - is it any good?

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

"The giant has added a gimmick to its savings range with £100,000 prizes but chances of winning are tiny so focus on rate ..."

Read the full story:
Halifax launches Premium Bond-style savings draw: is it any good?

JimmyTheWig

How many customers are likely to be entered into this? That's needed to give the mean expected returns.
Can you deposit the money one day and withdraw it the next and still be in the draw?

opinions4u

T&Cs say you have to keep £5k in for a full month to qualify.

Worth getting registered early while the numbers are low.

mrchagle

Registered just now. Under my ISA which stays there the full year.

callum9999

So It's not like premium bonds at all...

Consumerist

callum9999 wrote: »

So It's not like premium bonds at all...

Agreed. Seems like a "bog standard" monthly prize draw. No idea where the premium-bond similarity has come from. MSE standard hype, I think.

Now, far be it for me to look a gift horse in the mouth (except where banks are concerned) but this draw is going to cost them £0.5M per month so what's the catch? Why not increase savings rates? The draw will include fixed-rate savers so I don't see any advantage to the bank which presumably is looking to attract new savers.

Decluttering

Seems a bit of a gimmick to me but if they want to give away money to existing customers (and those who feel it is worth switching) I'm not complaining!

antispam246

Probably something about the "sharing your details with a 3rd party"? Regardless, I'm in as I already qualify with an existing ISA.

grizzly1911

Do Birmingham Midshires accounts qualify if BOS do?

rb10

grizzly1911 wrote: »

Do Birmingham Midshires accounts qualify if BOS do?

No. They are specifically excluded in the T&Cs.

It's only Halifax or Bank of Scotland branded accounts that qualify.

opinions4u

Consumerist wrote: »

Agreed. Seems like a "bog standard" monthly prize draw. No idea where the premium-bond similarity has come from. MSE standard hype, I think.

I suppose you still get your interest though ... so maybe an improvement on Premium Bonds.

Now, far be it for me to look a gift horse in the mouth (except where banks are concerned) but this draw is going to cost them £0.5M per month so what's the catch?

There doesn't seem to be one.

Why not increase savings rates?

£6m a year between 20m savers is about 30p each. So they have presumably made a judgement that the chance of £100k is worth more to customers than 30p.

The draw will include fixed-rate savers so I don't see any advantage to the bank which presumably is looking to attract new savers.

And keep existing ones. It's amazing how many people like Premium Bonds, despite the poor prize pot of 1.5%. They don't look at the prize pot though, they look at the top prize.

For me, a prize draw does nothing. It doesn't excite me and the odds of winning are low.

But for many it does excite. For some it will attract them to Halifax instead of NS&I or instead of another bank paying the same rates. For others it will stop them withdrawing £10k and banging it in Premium Bonds. Afterall, interest AND a (very slim) chance of £100k is usually better than an exceptionally slim chance of winning a worthwhile Premium Bond prize.