Halifax Fixed Savings T&Cs Misleading and Inaccurate

bigboyeast

Recently my Halifax Fixed 2 year Web Saver account matured. I received a maturity letter which gave me the option to reinvest the capital into a new Fixed Online Saver account. I filled in the form, but as I mislaid the envelope and no return address was on the form or accompanying letter, I took the form to my local Halifax branch. They said they would send it internally to be actioned

On this form I requested a new 2 year Fixed online Savings account with annual interest paid into the account. My Web Saver Account matured yesterday and guess what? - no new Online Fixed Saver Account was set up and the matured funds were transferred to my existing Easy Access Web account.

I thought, no problem, I can just set the account up via my Online banking. But no. I found that although the account’s Special Conditions (T&Cs) , which I had to read and agree to before opening the account, state that interest can be paid into the account; there was no method of setting this up. Hence the account will not pay compounded interest.

I went back to the original reinvestment letter and it also quotes the same special conditions which are stated below:-

From Fixed Online Saver – Special Conditions

We pay fixed interest depending on the length of time you choose to save. This means the interest rate won’t change during the term of your Fixed Online Saver account. We’ll show the different interest rates for the various terms we offer on our website.

• If you choose to save for 3 or 6 months, we’ll pay interest either monthly or at the end of the term.
• If you choose to save for 9 months, we’ll pay interest either monthly or quarterly.
• If you choose to save for 1, 2, 3, 4 or 5 years, we’ll pay interest either monthly or annually.

If you choose to have your interest monthly, it may be at a different rate. We will pay the interest into your account or you can ask us to pay it into a different account held with us or with another bank or building society.

To me this is very clear. Interest can be paid into “the account”.

Now looking more closely at the Halifax Savings Account General Savings Conditions (part of the same T&Cs document), they state that :-

7.3 The special or additional conditions will tell you when and how we pay interest, if any, on your account. If the day interest is due to be paid on an account is not a working day, we will calculate it up to, and on, the next working day unless the special or additional conditions for your account state otherwise. We will calculate interest (if applicable) at the end of each working day. You may not therefore be able to withdraw interest until the following day. We pay compound interest if interest is credited to the same account (rather than to another account) as it becomes part of the account balance and counts towards the amount we pay interest on. Unless the special or additional conditions say otherwise, interest will be credited to your account.

So the special conditions for this account say interest can be paid into the account and the general terms say it will be compounded, but Halifax won't let you set it up.


I have spoken to Halifax and they say that there is no way of setting up this account to have the interest retained in it, but surely then the published Account Special Conditions and the letter I received from Halifax are inaccurate and misleading. Do you think I have a case to take to the Financial Ombudsman Service.

Also, has anyone else been able to reinvest their capital from a maturing Halifax Web Saver Fixed account into an Online Fixed Saver Account and have it set it up to have the interest paid annually into the new account to get compound interest.

opinions4u

Do you think I have a case to take to the Financial Ombudsman Service.

To achieve what?

Your point appears to be valid. But I'd suggest that it's of no interest to the FOS.

Make a complaint to Halifax. It may be something that they want to offer in the future and have set up the "small print" to do this, but the systems are a bit behind. IIRC, Lloyds TSB Term Deposits don't allow you to credit interest to the account. Halifax now sits on the same platform.

The outcome won't be an immediate change to the way an account works though. That takes months for a provider to deliver. If they want to.