MSE News: New Club Lloyds current account offers 4% interest – should you sign up?

JamesCurt

Lloyds_Bank wrote: »

Hi drlabman,

You would earn the Vantage credit interest (providing you meet the criteria) up until the date in June your account was converted to Club Lloyds. With regard to interest after that, you would earn the Club Lloyds rate of credit interest up until the end of this month, even though your two Direct Debits wouldn't be going out until July.

Hope this info helps,

Craig

Hi,

I have a similar query to this one regarding the interest. I opened the account last week and have arranged for two Direct debits to go from this account. The first one is fine, it will be start from next month, however the second Direct debit is for my Lloyds Credit card and the next Direct Debit payment will be in October.

Will interest be paid even though I wont have two Direct debits going out until October?

Lloyds_Bank

JamesCurt wrote: »

Hi,

I have a similar query to this one regarding the interest. I opened the account last week and have arranged for two Direct debits to go from this account. The first one is fine, it will be start from next month, however the second Direct debit is for my Lloyds Credit card and the next Direct Debit payment will be in October.

Will interest be paid even though I wont have two Direct debits going out until October?

Hi JamesCurt,

Yes, interest will be paid as you don’t need to have the Direct Debits set up and taken straightaway. We're aware that it can take some time to get Direct Debits set up and running. To ensure we always put the customer in the best possible position, we will pay credit interest on balances regardless of whether or not they have two Direct Debits set up, until they've completed one full charging cycle on the Club Lloyds account.

The charging cycle for the account runs from the second working day of the month until the first working day of the following month. For example, if you opened your account on Tuesday last week (26/08/14), you'll receive credit interest at the end of today and the first working day of October. From what you've said, you'll then have two Direct Debits going out in October meaning you'll then fulfil the criteria for the next interest payment at the start of November.

This set up on Club Lloyds means all customers have between 4 and 8 weeks to set up Direct Debits on their account.

Hope this helps,

Craig

Chrysalis

if I understand this right someone not meeting the monthly income requirements but has a balance of over 4k will still be in profit right? What is the interest rate on the classic Lloyds account, is it 0?

Archi_Bald

Chrysalis wrote: »

if I understand this right someone not meeting the monthly income requirements but has a balance of over 4k will still be in profit right?

There is no monthly income requirement - all that is required to save the £5 monthly fee is that a total of £1,500 gets paid into the account each month. Everybody who has £4K sitting in a current account is able to meet this requirement - just shuttle £1,500 (or 3 x £500 etc) between the Club Lloyds and another current account elsewhere. The other account could for instance be a Halifax Reward account, which pays you £5 a month if you play your cards right. So instead of reducing your interest by £5 each month, you can actually make an extra £5.

Chrysalis wrote: »

What is the interest rate on the classic Lloyds account, is it 0?

yes

HAPPY_CHRIS

Hello I foolishly upgraded my very old Gold account which had always been free even with the benefits to a Club Lloyds account. I did not do this before ringing CS and I was assured nothing would change! How foolish of me. I have since realised after trips to my local branch and more phone calls that this is now irreversible. So I am now charged £12.95 for an account that I have had free for donkeys years unless I keep £2000 in the account. Why would anyone keep such an amount in a current account? I am very upset with Lloyds as I feel I have been advised wrongly and after over forty years it is time to move away.

colsten

HAPPY_CHRIS wrote: »

Why would anyone keep such an amount in a current account?

Because you would get a lot more interest in the current account than in any savings account, incl. ISAs. Some people here keep up to £50,000 in various current accounts for that reason.

If you got incorrect advice fromLloyds, you should be raising a formal complaint http://www.complaintsnumbers.co.uk/numbers/lloyds-bank

HAPPY_CHRIS

Thank you Colsten. I have raised a complaint already.

bugwoman

I'm surprised they gave you those terms. The £2000 threshold is for another very old Gold Account, which was then closed to new applicants, who had to pay £12.95 a month no matter how much they had in their account, as this was supposedly in return for the benefits (travel insurance, mobile phone insurance, AA membership, Sentinel card protection). Mine is the 'no fee unless you drop below £2k' type, which my branch manager tells me I should never try to tamper with!
The Club Lloyds Gold account charges £17.95 a month, but only £5 of this is waived if you fulfil the Club Lloyds criteria.
Gold accounts of any kind have been dropped completely for new customers

HAPPY_CHRIS

Thank you for your input. My gold account was the very very old one which was free. I wish now I had never tampered with it, and long for the old days when we had nice kindly bank managers! By the way I worked for Lloyds for over twenty years and worked for some very nice managers!! My complaint is the advice I was given by CS on the phone but they were probably unaware this 'free' gold account ever existed.

Kendall80

I also have the 'don't drop below 2k' account. I considered moving it into a TSB classic plus but the AA membership alone (personal so for 2 cars) makes it worth more than the interest I'd receive. Its a joint account too so essentially that's 2 people covered for 2 cars which would cost near 180 direct if I remember correctly.