Interest earning accounts for clubs.

BML

I am a Secretary to a small angling club which has about £10,000.00 in its bank account. We get less than 0.5% interest while I see individual bank accounts getting much more.

Can anyone tell me why Banks and Building Societies behave like this and more to the point can anyone tell me where the club could get a better deal?

jonesMUFCforever

Not a lot of banks want the hassle of having club society accounts.
You will not get anywhere near the rate on a personal account.

BML

With respect, is there any evidence to suggest that Banks really consider a Club account creates any more hassle than an individual account or do they act as a cartel knowing that clubs can do nothing about it and the Banks and Building Societies just sit on some very nice piles of money screwing the clubs?

ChiefGrasscutter

Yes there is more hassle

Clubs and societies accounts have multiple signatures on cheques to deal with
There are often changes of authorised signatures following changes to committee members all of which require more paperwork and staff to sort out, ID checks to be done etc.

Virtually none yet offer on line access - due to the multiple signature authorisation bit I suspect.

I'm treasurer of two local clubs and I can assure you that the amount of paperwork passing back and fro, cheques to pay in, monthly paper statements to be filed and checked off for each of these accounts (2 for each society) is far far far in excess of the stuff generated by my personal account.

It has always been so...well actually it was not always so, there was a time when a club/society had to pay bank charges for each transaction. - that tended to focus the mind a little!

Do the Building Socs even have such accounts - I thought it was generally only the main clearing banks that could be bothered to offer them as they are simply too much hassle

Scottish Widows bank used to offer a 60 day notice clubs and societies account linked to your main society operating account only but giving interest near to base rates - that was when base rates were high of course before someone in their wisdom thought it would be a good idea to reduce them.......

ColinFishwick

Its probably due to extra admin costs

http://www.thisismoney.co.uk/money/article-1585161/Banking-for-clubs-and-societies.html

rb10

CAF Bank and Unity Trust bank are both good ... but not sure if you have to be a registered/exempt/excepted charity to apply.

BML

I can not accept that my personal account with its many transactions is not much more complicated than the club account with possibly a dozen or so cheques a year.
However, even if it was that does not excuse the bank from criticism for paying us less than 0.5% on a deposit account. There a bunch of crooks.
Many thanks for the article and other sugestion that I will look at in the morning.

ses6jwg

BML wrote: »

I can not accept that my personal account with its many transactions is not much more complicated than the club account with possibly a dozen or so cheques a year.
However, even if it was that does not excuse the bank from criticism for paying us less than 0.5% on a deposit account. There a bunch of crooks.
Many thanks for the article and other sugestion that I will look at in the morning.

The bank of england rate is 0.5%. They are not obligated to pay any interest at all on the funds. They are a business not a charity.

BML

0.5% it may be but what is charged on a credit card and all the other loans?

opinions4u

1.60% with 7 days notice.

1.25% with easy access.

http://www.scottishwidows.co.uk/bank/savings/club_association_interest_rates.html

0.5% it may be but what is charged on a credit card and all the other loans?

50% of customers don't carry a balance on their credit card. So They get interest free credit. Many of the rest tart themselves from 0% deal to 0% deal. Factor in the write-offs and you'll notice that they don't make a huge amount at the end of the day.

I can not accept that my personal account with its many transactions is not much more complicated than the club account with possibly a dozen or so cheques a year.

Grasscutter's post is pretty accurate. Non-personal accounts are an administrative pain, tend to operate on low average deposits (your £10k is unusual for a club) and often require a completely different set of procedures and governance to operate. In other words, they layer on cost and provide little in way of savings flows. It's not a market worth cornering.

We get less than 0.5% interest while I see individual bank accounts getting much more.

Strip out the introductory bonus and many pay significantly less than 0.5%.

BML

I am finding it difficult to accept many of these answers and can only believe that they must be posted by those who work with in the Banking world.
I see excessive profits being extracted by banks and even more excessive salaries and bonuses being paid to Bankers while normal folk are being ripped off by what are no more than robber barons.
When I last visited my Bank the young lady I spoke to told me that her and her husband are paying £1,000.00 a month rent and despite them both being in employment they are unable to get a mortgage. What is happening to the country?