The Top Easy Access Savings Discussion Area

refluxer

RG2015 said

This is an interesting observation and I have just looked at the other leading easy access accounts on Moneyfacts for similar restrictions (or caveats).

These restrictions include the following:

Require a current account (as above)
Minimum opening amount or balance above £1
Limited access
Includes a bonus
Sharia accounts - hence technically only an expected rate.
App only

The first unrestricted account I can see is the Ford Money Flexible Saver at 1.30% AER.

I would note that this only allows transactions to a nominated account and the fastest withdrawals are only next day.

If this is considered to be a restriction, then the next level is at 1.25% for Investec, JN and Tandem.

In conclusion, there are numerous easy access accounts offering between 1.30% and 1.56% but all have some sort of restriction, caveat or limitation.

Yes - you're right, although I think it's fair to say that some of those limitations are more of an issue than others.

For example - for me personally, a £1 minimum balance and bonus element wouldn't even register as being an issue, however a required current account and limited access potentially could be. Everyone will have different requirements and preferences though, of course.

Speaking of limited access accounts, I still find their inclusion in the top Easy Access table puzzling. Yes, I get that your money isn't technically locked away and inaccessible but, for me, an important aspect of an Easy Access account is being able to move money freely whenever I want and without penalty, which you clearly can't do with an account that offers a severely limited number of withdrawals and penalises you for exceeding that limit. They obviously have their place (I have one or two myself) but I personally think they should have their own table.

RG2015

refluxer said:

RG2015 said

This is an interesting observation and I have just looked at the other leading easy access accounts on Moneyfacts for similar restrictions (or caveats).

These restrictions include the following:

Require a current account (as above)
Minimum opening amount or balance above £1
Limited access
Includes a bonus
Sharia accounts - hence technically only an expected rate.
App only

The first unrestricted account I can see is the Ford Money Flexible Saver at 1.30% AER.

I would note that this only allows transactions to a nominated account and the fastest withdrawals are only next day.

If this is considered to be a restriction, then the next level is at 1.25% for Investec, JN and Tandem.

In conclusion, there are numerous easy access accounts offering between 1.30% and 1.56% but all have some sort of restriction, caveat or limitation.

Yes - you're right, although I think it's fair to say that some of those limitations are more of an issue than others.

For example - for me personally, a £1 minimum balance and bonus element wouldn't even register as being an issue, however a required current account and limited access potentially could be. Everyone will have different requirements and preferences though, of course.

Speaking of limited access accounts, I still find their inclusion in the top Easy Access table puzzling. Yes, I get that your money isn't technically locked away and inaccessible but, for me, an important aspect of an Easy Access account is being able to move money freely whenever I want and without penalty, which you clearly can't do with an account that offers a severely limited number of withdrawals and penalises you for exceeding that limit. They obviously have their place (I have one or two myself) but I personally think they should have their own table.

I had meant more than £1 and especially those accounts requiring a minimum opening balance of £1,000 such as Secure Trust (1.40%).

I agree with your assessment of limited access accounts and prefer short access notice accounts. I have the Coventry 21 day notice account, currently at 1.55% AER.

It is a shame that it is still beaten by the VM saver. If it had been 1.60% I would have moved some of my VM savings there.

whatleytom87

At the end of the day, all of these mechanisms are designed in some way to reduce the overall payable rate for the bank whilst still appealing to a certain segment of customers. 

As you rightly point out, none of them are perfect so to speak, and what is an issue for one person is definitely not for another. 

Will be interesting to watch Chase pan out. Obviously Marcus did similar, but with a much less attractive offer, when the market at the time was much closer. Chase have gone all out to acquire a huge amount of current account volume at massive cost, not just the savings rate but the refer a friend incentive, cashback, near perfect exchange rate and round up account. It won't last, and will be interesting to watch them wind it back in. 

They took over 500k customers in the 60 days to the end of May which was just over £8bn, with the ringfence limit of £25bn you'd imagine at that run rate they're going to maintain the offers until around September at which point it's probably going to be significantly less attractive. 

RG2015

whatleytom87 said:

At the end of the day, all of these mechanisms are designed in some way to reduce the overall payable rate for the bank whilst still appealing to a certain segment of customers. 

As you rightly point out, none of them are perfect so to speak, and what is an issue for one person is definitely not for another. 

Will be interesting to watch Chase pan out. Obviously Marcus did similar, but with a much less attractive offer, when the market at the time was much closer. Chase have gone all out to acquire a huge amount of current account volume at massive cost, not just the savings rate but the refer a friend incentive, cashback, near perfect exchange rate and round up account. It won't last, and will be interesting to watch them wind it back in. 

They took over 500k customers in the 60 days to the end of May which was just over £8bn, with the ringfence limit of £25bn you'd imagine at that run rate they're going to maintain the offers until around September at which point it's probably going to be significantly less attractive. 

Regarding Chase, I cannot see how they will generate enough income to cover the cost of these incentives. And this is before covering their running costs.

WillowLea1962

Tandem instant access saver app now showing 1.35% AER 

MDMD

RG2015 said:

whatleytom87 said:

At the end of the day, all of these mechanisms are designed in some way to reduce the overall payable rate for the bank whilst still appealing to a certain segment of customers. 

As you rightly point out, none of them are perfect so to speak, and what is an issue for one person is definitely not for another. 

Will be interesting to watch Chase pan out. Obviously Marcus did similar, but with a much less attractive offer, when the market at the time was much closer. Chase have gone all out to acquire a huge amount of current account volume at massive cost, not just the savings rate but the refer a friend incentive, cashback, near perfect exchange rate and round up account. It won't last, and will be interesting to watch them wind it back in. 

They took over 500k customers in the 60 days to the end of May which was just over £8bn, with the ringfence limit of £25bn you'd imagine at that run rate they're going to maintain the offers until around September at which point it's probably going to be significantly less attractive. 

Regarding Chase, I cannot see how they will generate enough income to cover the cost of these incentives. And this is before covering their running costs.

They won’t be. They are treating it as a marketing cost and buying market share. 

https://www.cityam.com/jpmorgan-braced-for-more-than-1bn-losses-on-digital-retail-bank-chase/

There is a similar picture at GS with Marcus

https://www.bloomberg.com/news/articles/2022-06-28/goldman-sees-losses-topping-1-2-billion-from-its-consumer-push

janusdesign

Nationwide BS have a 1.4% 1-Yr Triple Access account - 3 withdrawals per year (more and it drops to 0.1%)... the account lasts a year from it's opening and funds are transferred to a lower interest instant access account at the end of those 12 months.

Thumbs_Up

Regarding Tandem. What is the tactics at play if I can call it that.

Surely they won’t get inflows of new money will they? It is just a patsy for their apathy savers.  

 

whatleytom87

RG2015 said:

whatleytom87 said:

At the end of the day, all of these mechanisms are designed in some way to reduce the overall payable rate for the bank whilst still appealing to a certain segment of customers. 

As you rightly point out, none of them are perfect so to speak, and what is an issue for one person is definitely not for another. 

Will be interesting to watch Chase pan out. Obviously Marcus did similar, but with a much less attractive offer, when the market at the time was much closer. Chase have gone all out to acquire a huge amount of current account volume at massive cost, not just the savings rate but the refer a friend incentive, cashback, near perfect exchange rate and round up account. It won't last, and will be interesting to watch them wind it back in. 

They took over 500k customers in the 60 days to the end of May which was just over £8bn, with the ringfence limit of £25bn you'd imagine at that run rate they're going to maintain the offers until around September at which point it's probably going to be significantly less attractive. 

Regarding Chase, I cannot see how they will generate enough income to cover the cost of these incentives. And this is before covering their running costs.

There's an awful lot of potential in having 1.5m current account customers. I would guess the next stage is attempting to convert those current accounts into prime relationships, at which point the income generating products can be rolled out. My understanding is that the UK market is a proving ground for rolling out the same tech/proposition to a whole batch of other worldwide territories. 

Olinda99

whatleytom87 said:

RG2015 said:

whatleytom87 said:

At the end of the day, all of these mechanisms are designed in some way to reduce the overall payable rate for the bank whilst still appealing to a certain segment of customers. 

As you rightly point out, none of them are perfect so to speak, and what is an issue for one person is definitely not for another. 

Will be interesting to watch Chase pan out. Obviously Marcus did similar, but with a much less attractive offer, when the market at the time was much closer. Chase have gone all out to acquire a huge amount of current account volume at massive cost, not just the savings rate but the refer a friend incentive, cashback, near perfect exchange rate and round up account. It won't last, and will be interesting to watch them wind it back in. 

They took over 500k customers in the 60 days to the end of May which was just over £8bn, with the ringfence limit of £25bn you'd imagine at that run rate they're going to maintain the offers until around September at which point it's probably going to be significantly less attractive. 

Regarding Chase, I cannot see how they will generate enough income to cover the cost of these incentives. And this is before covering their running costs.

There's an awful lot of potential in having 1.5m current account customers. I would guess the next stage is attempting to convert those current accounts into prime relationships, at which point the income generating products can be rolled out. My understanding is that the UK market is a proving ground for rolling out the same tech/proposition to a whole batch of other worldwide territories. 

also, it depends what they did with all the money flowing into their savings accounts.

If they transferred it to the States, then the way the GBP has fallen against the USD means they will be well in profit, even after paying us 1.5% interest.