HSBC ups Online Saver rate to 5.75%

Beate

Is it worth closing the existing one and opening a new one? You will lose the interest for the entire month of closing the account, and if you have no external account to transfer from, is it really worth it? Advice please as I am going to my local branch soon to have a word.

intalex

Beate wrote:

Is it worth closing the existing one and opening a new one? You will lose the interest for the entire month of closing the account, and if you have no external account to transfer from, is it really worth it? Advice please as I am going to my local branch soon to have a word.

Entire month = only 5 days if you close it today, which isn't too bad.

I'm all confused about "we may only pay you the standard rate if you pay in from another HSBC a/c". Now what's that supposed to mean?

Something tells me this is a "very" short time offer and that the interest rate is likely to drop in a month or so. There are no guarantees as to how long it will last. Some inside info at this stage would be most helpful.

gt94sss2

Beate wrote:

Is it worth closing the existing one and opening a new one? You will lose the interest for the entire month of closing the account, and if you have no external account to transfer from, is it really worth it? Advice please as I am going to my local branch soon to have a word.

It depends on the amount of money involved but its worth noting that the new offer doesn't seem to be 5.75% until a set date but a (semi?) permanent increase.

If you close your existing account now, you will only lose 5 days interest

As for using a external account to transfer money from - while that might technically meet the T&C, I don't think HSBC will really enforce this..

Regards
Sunil

Kazza242

Beate wrote:

Is it worth closing the existing one and opening a new one? You will lose the interest for the entire month of closing the account, and if you have no external account to transfer from, is it really worth it?

Whether it is worth closing the existing account and opening the new one depends on the current balance in the standard account. If the balance is under £1K, then you'll have less to lose by closing it now. If the balance is relatively large, then I would wait until March 1st.

On closing the account you will lose any interest accured from Feb 1st to the present. I would be surprised if the 5.75% offer wasn't still available on March 1st, so you may want to wait until then, so that you don't lose out on the 5 days worth of interest your money will already have accrued.

Beate

Okay, I have just been to my local branch and the deal is basically this: Existing customers are left out in the cold.

The 5.75% will ONLY be paid on monies new to HSBC, i.e. coming from an external bank account. If they come from an external bank account into your HSBC Current Account first and then get transferred over, their clever systems can apparently pick that up, and the 5.75% will be paid. This is probably what this "we may pay you" is about. However, I pointed out that this is very mistakenly worded and should state clearer that the full interest rate is only ever payable to "all new to HSBC monies". She agreed and gave me a leaflet entitled "Listening to your comments". "Just write to the address in their", she said. Will do.

So, if you currently bank with someone else, great, apply for it soon (she said that offer probably won't stand longer than a month), and pay as much in as you can from another account.

As an existing customer, you could of course cancel your Online Saver, pay the money in with another bank, open the new Online Saver and pay it back. That will work, but only for that money. Any additional money you later want to pay in from an HSBC account will get the 5.25%. So if you are very HSBC based with your money and have an Online Saver already, I would stear clear of it - you only lose interest for the closing month and then aren't better off than before rate-wise. And the maximum for the new account is £50,000 instead of £2 millions - not that this would make much difference for most people, but it needs to be taken into account for very large lump sums.

gt94sss2

Beate wrote:

The 5.75% will ONLY be paid on monies new to HSBC, i.e. coming from an external bank account. If they come from an external bank account into your HSBC Current Account first and then get transferred over, their clever systems can apparently pick that up, and the 5.75% will be paid.

While the staff may tell you this as the aim is probably to attract 'new money' to HSBC - I think its extremely unlikely that HSBC will actually do anything of the sort.

Its just not worth the time/money for them to program their IT systems to do it.. I think the T&C are just written to 'encourage' new money to come to HSBC and not just moved within HSBC

Remember, it says 'may' which is a classic scare tactic..

Regards
Sunil

Kazza242

Beate wrote:

The 5.75% will ONLY be paid on monies new to HSBC, i.e. coming from an external bank account. If they come from an external bank account into your HSBC Current Account first and then get transferred over, their clever systems can apparently pick that up, and the 5.75% will be paid. This is probably what this "we may pay you" is about.

Personally, I think if you are planning on opening the 5.75% Online Saver, then the way around it, if you're an existing customer, is to:

a) Close your existing Online Saver - provided you don't have a large balance in there and it is closed early in a given month.

b) Open the 5.75% Online Saver and when transferring monies into it, do so from an external bank current account.

I can't see how HSBC can penalise someone for doing that (b). Also you would be able to check the interest rate you had been paid after only a month - not a year, like some accounts.

Therefore, I don't think there is much to lose. It does involve an initial level of effort to begin with, but I think it's worth it for an extra 0.50% interest - especially if you are already an existing customer.

Beate

Well, I have quite categorically been told that the 5.75% will ONLY be paid to money coming from other banks, so I am not going through all that hassle of closing this one, opening a Current Account with another account, then transferring the money to and back, while losing interest for closing my existing account. As my money is with HSBC, I would have to do a double transfer every time I wanted to add money to my Online Saver. Other people might have different situations, so go ahead, but personally I don't see the point for me.

Kazza242

Beate wrote:

I am not going through all that hassle of closing this one, opening a Current Account with another account, then transferring the money to and back,...

I agree with what you've said, as you don't already have a current account elsewhere, then it isn't worth it. However, a lot of MSE's do have more than one current account, so it will probably be more worthwhile for them.

I expect that once the initial deposit has been made, the 5.75% online saver can then be funded from a HSBC current account - provided it is new money that is being added and not money from another HSBC savings account.

Beate

Kazza242 wrote:

I expect that once the initial deposit has been made, the 5.75% online saver can then be funded from a HSBC current account - provided it is new money that is being added and not money from another HSBC savings account.

You may well be right but it states nowhere that this is how it will be and as such I am a bit wary of the whole thing. Maybe other MSE's can speak to their local branch - as we well know, different bank managers say different things.