Nationwide regular saver paying 5%

aj23_2

bowlhead99 wrote: »

Most people understand that those gross assets are supported by liabilities - loans from other financial institutions and deposits from members.

The idea that just because they have millions of members causing the overall numbers to be large, they can "afford it" is a nonsense. Imagine you deposited £10,000 in a savings account with them. Then you come back the next week and there's only £9900.

"What on earth has happened?", you ask the bank, sounding distressed. "Ah, well, our old policy was to take good care of all our billions of pounds of assets including members' deposits. But then we read on MSE that aj23 thought we could afford to pay more interest on certain accounts, because there was billions. So we spent some of the billions on paying extra interest to people with certain branch-based accounts, as a loss-leader. aj23 didn't say we couldn't use *their* money to pay out the extra interest, they just saw we had a large total amount of assets so assumed we'd get it from somewhere. And we did. We used up some of the billions of assets. So, now we can't pay you back £10000, only £9900, because £100 went to the 'pay extra interest on branch based RS accounts' fund.



As you know, they are paid by taking a margin between the income (what they earn on lending) and what they pay out in operating costs and interest on deposits and long term funding.

So they are paid £x. If "what they pay out in operating costs" goes up from what it could have been because people have a conscientious objection to using the efficient online system to operate the savings accounts, then in order to preserve £x they are going to have to increase their income by putting borrowing costs up for homeowners or by reducing the rates paid on deposits.

You might prefer them to cut some other operating costs to be able to spend more money paying interest to the person who doesn't like computers, but even if the Board salaries were reduced from market rate to zero you would not get much spare cash per member.

Yeah, they can afford it. If they couldn't, they wouldn't have many, many headline rate products which they have been paying for years now. It's not about liking computers, I've heard a lot of people say they don't bank online and don't want to start. It's a personal choice. A branch is there to be used. Banks are raking it in. The directors of Leeds Building Society gave themselves £100k pay rises last year, to nearly half a million. The idea that banks are strapped is laughable. And a customer is a customer and should be valued regardless of if they bank online or not. Without them, they don't exist.

PeacefulWaters

a customer is a customer and should be valued regardless of if they bank online or not.

Surely a customer who is cheaper to maintain as a result of being online should be valued more.

Without them, they don't exist

Without loss making customers, they exist more profitably. Surely that's good for the wider membership.

polymaff

You'll never change a Luddite's mind

aj23_2

PeacefulWaters wrote: »

Surely a customer who is cheaper to maintain as a result of being online should be valued more.

Without loss making customers, they exist more profitably. Surely that's good for the wider membership.

Absolutely not. What a stupid thing to say :rotfl: Why should someone who has banked online for 2 months be more valued than someone who doesn't bank online and has been a member for 20 years and had mortgages, loans, currents accounts, credit cards and savings accounts.

So by your logic, those with small mortgages should be valued more than those big mortgages as there is less risk involved and thus a cheaper liability, despite the fact they make more from those with big mortgages and/or who are on interest only.

And who said being online is cheaper? Online banking fraud is at a high and rising, and hacking is becoming more prevalent. That costs money to maintain and safeguard against. Online security and technology costs a fortune to implement and to run. It requires 24/7 maintenance and support.

PeacefulWaters

aj23 wrote: »

Absolutely not. What a stupid thing to say :rotfl: Why should someone who has banked online for 2 months be more valued than someone who doesn't bank online and has been a member for 20 years and had mortgages, loans, currents accounts, credit cards and savings accounts.

You're creating a different customer comparison to the rather simpler one of "customer opening product online" v "opening in branch". Twisting things to suit a point of view?

So by your logic, those with small mortgages should be valued more than those big mortgages as there is less risk involved and thus a cheaper liability, despite the fact they make more from those with big mortgages and/or who are on interest only.

It really is a bizarre leap to come to that conclusion.

And who said being online is cheaper? Online banking fraud is at a high and rising, and hacking is becoming more prevalent. That costs money to maintain and safeguard against. Online security and technology costs a fortune to implement and to run. It requires 24/7 maintenance and support.

I would hazard a guess that EVERY bank and building society will tell you online customers are cheaper to maintain, even after fraud costs, than branch or telephone customers (where fraud also occurs).

Again, you seem to have an agenda and are making things up to support it.

I think I'll depart from such nonsense.

aj23_2

PeacefulWaters wrote: »

You're creating a different customer comparison to the rather simpler one of "customer opening product online" v "opening in branch". Twisting things to suit a point of view?

It really is a bizarre leap to come to that conclusion.

I would hazard a guess that EVERY bank and building society will tell you online customers are cheaper to maintain, even after fraud costs, than branch or telephone customers (where fraud also occurs).

Again, you seem to have an agenda and are making things up to support it.

I think I'll depart from such nonsense.

Well, no, because branches are there to be used. People are paid to work in them. Lol.

I didn't think you'd agree with a scenario by your own example somehow. Telephone, internet purchasing and online banking fraud is up. Check Experian, ONS or Financial Fraud Action. My stats are backed up there :beer:

You're making up that online customers should be more valued with nothing to back it up. All customers are important, but it is usually those who are loyal to get preferential treatment. I've never heard of online customers beings more valued than non. You're the one who started this nonsense, and now you don't like that it sounds utterly stupid.

cloud_dog

Beware....rattle snake prodding about to commence...

aj23 wrote: »

Yeah, they can afford it. If they couldn't, they wouldn't have many, many headline rate products which they have been paying for years now.

Care to quote these headline products?

Other than the 5% regular saver, which is at the top for the IR but not for the monthly amount, I struggle to identify any. I'm sure NW mission statement (as a financial organisation) would say something like.... "Striving to be above average"

aj23 wrote: »

It's not about liking computers, I've heard a lot of people say they don't bank online and don't want to start. It's a personal choice.

Exactly. You don't like how they are operating then go somewhere else. The issue is the individuals not the organisations.

aj23_2

cloud_dog wrote: »

Beware....rattle snake prodding about to commence...

Care to quote these headline products?

Other than the 5% regular saver, which is at the top for the IR but not for the monthly amount, I struggle to identify any. I'm sure NW mission statement (as a financial organisation) would say something like.... "Striving to be above average"

Exactly. You don't like how they are operating then go somewhere else. The issue is the individuals not the organisations.

They have regular savers at 5% and current accounts at 5% and 3%. They have high rate children's and junior accounts too.

I never said the individual couldn't go elsewhere.

AndyPK

There was a call (on morning TV, ITV)(Mon,Thurs,Fri) in to Martin Lewis a couple of weeks ago, with a similar situation with Santander regular saver requiring online account. He went away and managed to find 2 or 3 accounts that did not require online access.

firestone

when everybody uses online for everything from banking,shopping,booking holidays,booking a doctors appointment,renting a movie,buying music and all the other things i have been told i can do by people in these places over the years what happens next? Don't worry people say its like the industrial revolution there was panic then but look at the jobs it created.But this time its about cost cutting and losing jobs so who knows maybe there will be a tipping point and with not enough being earned people will not have the money to buy things no matter how cheap online
just off to build my bunker:)