Chip Savings Account - a scam?

maxsteam

I haven't tried it and don't trust theses methods

There is no FCSC protection for Chip savers.

If one of the banks that Chip uses fails, Chip can make a claim under the FSCS. This is what the Chip website is referring to. If Chip fails, there is no FSCS protection for savers. Chip Financial Ltd is registered with the FCA under three registration numbers to allow them to use the trading names Chip, Get Chip and Chip X. You can take your pick as to which registration to check. They all say the same.

"The Financial Services Compensation Scheme will not be able to consider a claim against this firm if it fails."

https://register.fca.org.uk/s/firm?id=0010X00004VrUlpQAF

If Chip's website appears to contradict this, someone should raise the matter with the FCA but you will not change the fact that Chip savers can't claim under the FSCS. If you want further reading, you could study PremierFX. This business misled customers into believing that there was FSCS cover but, when the business failed, customers could not claim under the FSCS, they could only lodge a claim with the liquidator.

I will again ask posters to refrain from spreading misinformation about Chip and similar savings apps.

Emmia

Yes, it's been great!

maxsteam said:

There is no FCSC protection for Chip savers.

If one of the banks that Chip uses fails, Chip can make a claim under the FSCS. This is what the Chip website is referring to. If Chip fails, there is no FSCS protection for savers. Chip Financial Ltd is registered with the FCA under three registration numbers to allow them to use the trading names Chip, Get Chip and Chip X. You can take your pick as to which registration to check. They all say the same.

"The Financial Services Compensation Scheme will not be able to consider a claim against this firm if it fails."

https://register.fca.org.uk/s/firm?id=0010X00004VrUlpQAF

If Chip's website appears to contradict this, someone should raise the matter with the FCA but you will not change the fact that Chip savers can't claim under the FSCS. If you want further reading, you could study PremierFX. This business misled customers into believing that there was FSCS cover but, when the business failed, customers could not claim under the FSCS, they could only lodge a claim with the liquidator.

I will again ask posters to refrain from spreading misinformation about Chip and similar savings apps.

Please can you actually read the Chip T&Cs 

Chip is in effect a platform with arrangements with banks etc., that are covered by FSCS e.g. Allica bank. 

The "e-wallet" had no FSCS protection, but is an obsolete product. I've been with Chip for a while (early user) starting with the e-wallet which I'd use as a tool to bump my savings... I (and others I'm sure), knew it lacked FSCS so I used it to save £1000 which I'd then move to an FSCS protected account, and I accepted the risks. 

You don't have to use them.

maxsteam

I haven't tried it and don't trust theses methods

Emmia said:

Please can you actually read the Chip T&Cs 

Chip is in effect a platform with arrangements with banks etc., that are covered by FSCS e.g. Allica bank. 

Yes. Chip is covered in the event of a failure. Chip's customers are not covered.

Even if the T&C's promise FSCS cover for customers, the nature of their registration trumps this.

Please can you read Chip's FCA registration before moving your funds to a FSCS protected account. The FCA rather than Chip or anything that you read on a forum should be regarded as the reliable source of information in this situation.

The FSCS is only available for banks, credit unions, building societies and certain insurers. Chip does not qualify under any category.

Daliah

@maxsteam, will you please stop making false claims.

I don’t personally have any money or connections with Chip but I object in principle to false information being spread.

@Emmia has explained matters correctly, and these are backed up by information on the Chip website.

The way Chip now operates is the same in principle as HL Active Savings and Raisin are operating. I.e. people’s deposits in the target banks are safe up to £85k. 

maxsteam

I haven't tried it and don't trust theses methods

It's fair to conclude that the wording on Chip's website is misleading. People have read it and concluded incorrectly that FSCS cover is in place for Chip customers. The only FSCS cover is for Chip, not Chip customers.

At the end of my last post I provided a screenshot from the FSCS website which explains how to verify if a provider is FSCS protected. In an earlier post I provided a link to Chip's FCA registration details and a screenshot of their status relating to the FSCS. It is no small concern that people who should by now have read those posts and visited the FCA and FSCS websites are continuing to spread misinformation. Perhaps it is simply wishful thinking from savers. I am not sure what more I can do other than repeat Chip's FSCS status, screenshotted a few minutes ago from the FCA website.



I will also state what should be obvious in that it is not for Chip to decide its FSCS status. The status is decided by regulatory bodies. Anyone who is unhappy with this can complain to Chip and the Financial Ombudsman. They can also grumble on forums. Neither action will change Chip's FSCS status which is stated on the FCA website.

Daliah

Anybody who opens an account with Chip now has their deposits into that account covered up to £85K, as has been explained before.

Please stop scaremongering.

maxsteam

I haven't tried it and don't trust theses methods

Daliah said:

Anybody who opens an account with Chip now has their deposits into that account covered up to £85K, as has been explained before.

Please stop scaremongering.

Those are carefully chosen words. If a bank fails, Chip can claim up to £85k under the FSCS. If Chip fails, as I have repeatedly stated and as I have supported by sources more reliable than Chip's website, FSCS claims against Chip will not even be considered.

If you put money into a Chip account, there is no FSCS cover for you. If you put money into a bank account, there is FSCS cover. If you ask Chip to put your money into a bank account that is not in your name, you can't make a FSCS claim against Chip by nature of their FCA registration. The only way that you could claim against the bank is if the money was held in an account where you are listed as the beneficial owner.

Daliah

Chips doesn't claim. People do not have deposits with Chip any longer. It's been explained to you several times before.

If a bank with whom you hold deposits fails, the FSCS automatically reimburses you, up to £85k per person. Whether you used Chip or anyone else to make your deposits, or deposited directly doesn't matter.

For the umpteenst time: Please stop scaremongering about Chip.

maxsteam

I haven't tried it and don't trust theses methods

Daliah said:

If a bank with whom you hold deposits fails, the FSCS automatically reimburses you, up to £85k per person.

Only if the account with the bank is in your name. An account in your name with Chip counts for nothing under the FSCS.

mrkds

Yes, it's been great!

I have some monay in their ChipLite product earning 1.25% 'bonus' as they call it. I have recieved the bonus payments as expected. And have been able to withdraw my funds (albeit slowly). 

 Although ive nott had major problems, i'm not in a rush to recomend it to friends. Mainly because it's operation id very different to a regular savings account. The way the bonus is calculated weekly instead if daily, the weird way you have to link a debit card, the weird way they hold the capital and the interest in different banks  and the unusually long time it takes to deposit and withdraw funds are all a bit off putting. 

I have not used the AI feature as I only use it  to take advantage of the 1.25% bonus, but at one time I had turned it on, it decided to deposit £60, when I didn't even have that much in the account it was drawing from. So I don't really trust the AI feature that much either.

All that said, I don't think theyre a scam. I think they are trying to offer a novel way of saving, which is not put together that well.