Chip+1 Account moving to Allica Bank

Albo42

Hello
I joined the Chip+1 account via app etc as mentioned on the Money Saving Expert website savings. However, the Chip+1 account ( currently offering 1.25%) is closing and they are offering to move savings to Allica Bank offering 0.7%. Does anyone else use Chip+1 and feel comfortable with this offer? 
Thank you
Alan

tyrex

Surprised MSE hasn't run an article on this given that many are likely to have acted on MSE's advice initially.

Allica gives you 0.7% interest on up to £30k, however given that many Chip+1 users are being charged £1.50 per month to get the previous £10k/1.25% deal (and assuming this charge persists when the change takes place), the new effective rate is 0.64% when saving £30k. Worse if saving less. This is worse than the current MSE top easy-access savings accounts.

So saying, I'm likely to withdraw all of my cash when Chip+1 ends.

MSE_Emily

Thousands of savers with app-only provider Chip will see their market-leading easy access rate plummet from 1.25% to 0% next month unless they act. Many will also continue to be charged up to £39/yr for what will become a redundant account for those hoping to earn interest...

Read the full story:

Warning: Chip to slash 1.25% rate to 0% and it'll still make some pay for the privilege - act now

rjmachin

What will happen on the 8th December?  Will the account still be open, but earn no interest?

Assuming the partial interest is paid on the 8th December into the +1 account, can I then withdraw the money including the interest, or do I need to withdraw before the 8th December?

benhamnett

I've got a Chip+1 account and got the email from them saying this will be discontinued, but the money will move into the 0.7% account automatically.

Assume someone at MSE towers didn't get the message, could MSE_Emily respond or update the article rather than scaremongering? It's still a better rate than the top easy access posted in last nights' email!

NickJones1951

The 1.25% rate actually stops on 30 November - I just spotted that on their app. They didn't mention that in their email, did they? My fee will go up to 17 December, so I'll close everything down then. Sharp practice by them.

n15h

IMHO the new Chip account is still paying a decent rate (compared to many other low interest savings products) even after fees.

My crude calculations are that if the £10K is moved from Chip+1 to the 0.7% savings account, the £10K would earn £70 interest per year (at 0.7%) or £5.80 per month. Deducting the £1.50 monthly fee, leaves £4.30 per month interest or £51/year i.e. a net savings rate of 0.51%.

I also like the fact that with Chip, there is no minimum withdrawal limit so you can withdraw as much/little as you need. I saw that with Shawbrook easy access, there is a minimum withdrawal requirement of £500.

I'll continue to stay with Chip but of course, make your own judgement and decide what is best for you / your money.

Nardge

Looking for a click batey-esque headline? Look no further than Emily White. 

How about informing Chip users they can still get 0.7% as part of the headline rather than as a footnote at the bottom of the article? I know you make your money by getting people to continuously click links/move their accounts through your MSE webpage, but still...

Tabloid scaremogering behaviour Emily. Shame on MSE. 

eskbanker

Nardge said:

Looking for a click batey-esque headline? Look no further than Emily White. 

How about informing Chip users they can still get 0.7% as part of the headline rather than as a footnote at the bottom of the article? I guess you make your money by getting people to continuously click links and thus move accounts through your MSE webpage.

Tabloid scaremogering behaviour Emily. Shame on MSE. 

Doesn't seem like scaremongering to me - the article follows a fairly standard format of highlighting what is going to be happening and then covering what can be done about it, one of the (multiple) options prominently listed being to move to a different Chip account for the 0.7%.  The fact remains that action is required in order to continue to receive interest, so a headline emphasising this need to act ("....act now") is hardly unreasonable....

Edit: I'd missed the debate above about whether action is needed or not, so assumed that the MSE article was factually correct about the account continuing but at 0%, whereas email recipients are apparently being told that it's closing and funds moved to the 0.7% account.  If the latter is confirmed as true then yes, I agree that the MSE article and its headline aren't accurate!

rjmachin

I would like to know what happens if I take no action.

Will they close my account and move the money somewhere?
Will the account remain open, but earn no interest?

HHarry

benhamnett said:

I've got a Chip+1 account and got the email from them saying this will be discontinued, but the money will move into the 0.7% account automatically.

According to the email I received you have to give your consent, before the money is moved automatically.  I haven’t yet worked out how to give, or withold, consent.