Get your own back - Charge your bank over one googol % interest

1Amigo

Simply open yourself a halifax reward account. Transfer in £1000 and then transfer it back out again. Shouldn't take you longer than 10 minutes. Your £5 payment is now due.

Then give yourself a pat on the back as you've charged the bank over 10000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000% APR

Don't spend it all at once!

BoGoF

Old news to most people on this forum. Many people have multiple accounts.

nathand_2

Your math is a little wrong there. It can be done 12 times per year so that totals £60. Your return is then £60 over 12 months. 6%.

alanq

nathand wrote: »

Your math is a little wrong there. It can be done 12 times per year so that totals £60. Your return is then £60 over 12 months. 6%.

Only if the £1000 is transferred out then immediately back in each month. The OP was referring to transferring in then immediately out.

Thus the return is £60 on £0.

1Amigo

nathand wrote: »

Your math is a little wrong there. It can be done 12 times per year so that totals £60. Your return is then £60 over 12 months. 6%.

That is incorrect. The money is only in the account for 10 minutes. The fact that this can only be done 12 times a month is irrelevant as we are only concerned with those 10 minutes. You are effectively getting a return of 0.5% from a £1000 investment in 10 minutes which adds up to a hypothetical massive apr.

This is the same logic which was used in that bbc article with the title "UK banks charging as much as 800,000% on overdrafts".

torbrex

1Amigo wrote: »

Simply open yourself a halifax reward account. Transfer in £1000 and then transfer it back out again. Shouldn't take you longer than 10 minutes. Your £5 payment is now due.

Then give yourself a pat on the back as you've charged the bank over 10000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000% APR

Don't spend it all at once!

it does not really matter what the percentage rate is, it is still just £5, dressing it up in a high APR wont change that.

Jennifer_Jane

1Amigo - you should also mention A&L (merged with Santander)/Santander/First Direct/Co-op (finished now). Many of us have been using bank account switches for incentives. I would recommend that you keep an eye on this thread for such delights! Yes, many of us know about Halifax and have put this into place. If, however, your post has encouraged one new person to go for current account incentives, then that's good.

nathand_2

Once again your math is off. 12 times a year is actually very relevant. The time it takes to do however is not. If you're measuring interest yearly, which is where you see these high figures, then £60 is the most you can earn from it in a year and £60 is 6%. Doing it just the once in the case you pointed out is 0.5%.

Those not aware of this offer already will very much appreciate your post, I'm simply pointing out that the real figures are different.

noh

nathand wrote: »

Once again your math is off. 12 times a year is actually very relevant. The time it takes to do however is not. If you're measuring interest yearly, which is where you see these high figures, then £60 is the most you can earn from it in a year and £60 is 6%. Doing it just the once in the case you pointed out is 0.5%.

Those not aware of this offer already will very much appreciate your post, I'm simply pointing out that the real figures are different.

No.
It is your maths that is off.
It is a return of £60 net for zero investment.
ie 60/0 x 100%

You may argue that the return is lower than infinity because your money is tied up for a few minutes each month.
If you truly want infinite return then get an overdraft on the reward account and move that in and out to get the reward then the return is £60 p.a. net for zero investment.

JuicyJesus

torbrex wrote: »

it does not really matter what the percentage rate is, it is still just £5, dressing it up in a high APR wont change that.

See the post just above yours. It helpfully points out the ridiculousness of people/the media calculating an absurdly large APR on a flat fee (e.g. the quoted 800,000% APR for an overdraft charge) and claiming they've been charged eleventy billion percent interest.

Here, I imagine if you were quite savvy and quick with a mouse you could get the £1000 in and out at the same time through the cunning use of Faster Payments, meaning the effective AER on the account would therefore be infinity. And as you say, it's meaningless, because it's only a fiver. That's the point.

nathand_2

noh wrote: »

No.
It is your maths that is off.
It is a return of £60 net for zero investment.
ie 60/0 x 100%

You may argue that the return is lower than infinity because your money is tied up for a few minutes each month.
If you truly want infinite return then get an overdraft on the reward account and move that in and out to get the reward then the return is £60 p.a. net for zero investment.

Nope, you need £1000. Even though you get that straight back, you still need 1000 to 'invest' every month.