HSBC ups Online Saver rate to 5.75%

gt94sss2

Hmm.. while easier.com and Money News say it will be 5.75%, the Guardian are stating that they believe the new rate to be 5.6% and not 5.75% - though that seems to contradict the quote from the Head of Savings at HSBC.


I guess we will just have to wait until Monday for the full details.

Regards
Sunil

Kazza242

gt94sss2 wrote:

Hmm.. while easier.com and Money News say it will be 5.75%, the Guardian are stating that they believe the new rate to be 5.6% and not 5.75% - though that seems to contradict the quote from the Head of Savings at HSBC.


I guess we will just have to wait until Monday for the full details.

I believe that the Guardian are quoting the Online Saver's gross rate of interest and not the AER. A gross rate of 5.60% works out as 5.75% AER, as the interest is paid monthly and if left in the account, will be compounded.

gt94sss2

I should have thought of that - especially after I had already worked out thats why they were quoting 5.13% for existing customers and not 5.25% - but I didn't apply the same principle across..

Regards
Sunil

macgyver

Hi there,
I have an online saver with HSBC and I got a letter from them informing about the increase in rate and it only mentioned the rate going up to 5.25% and not 5.75% as suggested here.
Here is the copy of the mail I got:

Your Online Saver rate is about to get even better!

On 11 January 2007 the Bank of England raised the Base Rate by 0.25% to 5.25%.

The great news for you is that from 5 February 2007 we will pass on the full benefit of this increase and your Online Saver rate will go up by the full 0.25% to 5.13% gross, 5.25% AER variable.

As Online Saver is designed for people with longer term savings goals, you won't receive any interest on the full balance in the month you make a withdrawal. This allows us to give you a market-leading rate on an account that's for savers - not spenders.

For more ways to save with HSBC please click 'Apply for Savings' from the left hand menu.

Thank you.

gt94sss2

macgyver wrote:

I have an online saver with HSBC and I got a letter from them informing about the increase in rate and it only mentioned the rate going up to 5.25% and not 5.75% as suggested here.

Yes, I got a copy of that message as well.

However, it looks like HSBC are about to launch a new version of the account paying a higher rate of interest.

There do seem to be some differences though, for instance the new version will have a maximum balance of £50,000 instead of the current £2million limit.

We will have to wait until Monday to find out:

- if existing customers will need to close their existing Online Saver accounts to open this new one or if both that be run together (at the moment HSBC's T&C say customers can only have one Online Saver account each).

- if the new account continues to pay no interest in any month where there is a withdrawal

Slightly OT: but I would expect First Direct to do something similar as well

Regards
Sunil

azthe

Is it possible to have the monthly interest credited to another account without incurring the withdrawal penalty?

tom188

The old one could have the interest credited to another HSBC account without penalty.

gt94sss2

Details of the new Online Saver are now on HSBC's website

Regards
Sunil

fnarkfnark

No love for existing customers? Boo!

(unless I've read it incorrectly!)

Kazza242

fnarkfnark wrote:

No love for existing customers? Boo!

(unless I've read it incorrectly!)

The terms and conditions state that:

You can only have one Online saver. If you already have an Online Saver you cannot open another one.

I think this means that you cannot hold the standard Online Saver and the 5.75% one at the same time. There's nothing to stop you closing the standard one and then applying for the 5.75% one. If you choose to do this, I'd recommend transferring the money into the 5.75% account from an external bank account, as the T&C's state:

If you transfer monies into your Online Saver from another HSBC bank account we may pay you the standard Online Saver interest rate on such monies.