Top Savings Accounts recommendations - Chip Financial not as it seems

Band7

nottsphil said:

AndyTh_2 said:

Chip doesn't hold your money, they put it in Clearbank savings accounts (or Alica for older savings products) opened per customer, with £85k FSCS protection.

And that's the troubling thing for me. Clearbank don't have a numbered account with my name on it AFAIK. If they did then surely I would have a right to interact with it? So, how do we know that the FSCS won't simply apply the £85,000 limit to this single account, which when divided amongst savers might result in us getting, IDK, a penny for every £10,000 of our balance?

Not sure why you think you need to have a traditional account number to get £85K FSCS protection. 

If you are of the view that CHIP and/or Clearbank have published false / misleading information, you should report them straight away to FSCS, rather than developing wild theories about not having protection. Please let us know what FSCS will do as a result of your report.

alrk

One issue that has occurred to me is that if i was incapacitated my husband wouldnt be able to access the money in our chip account, so we have decided he will have an account as well and split the money between the 2

Arthurian

nottsphil said:

AndyTh_2 said:

Chip doesn't hold your money, they put it in Clearbank savings accounts (or Alica for older savings products) opened per customer, with £85k FSCS protection.

And that's the troubling thing for me. Clearbank don't have a numbered account with my name on it AFAIK. If they did then surely I would have a right to interact with it? So, how do we know that the FSCS won't simply apply the £85,000 limit to this single account, which when divided amongst savers might result in us getting, IDK, a penny for every £10,000 of our balance?

Years ago, someone in these forums had booked a cruise with one of those holiday companies which have promotional programmes on shopping TV channels.  They were shocked to lose their money when the company promoting on TV went bust.  The actual cruises were run by ABTA and ATOL protected companies, but because they had paid the shopping TV company, there was no protection.  That’s what I think of whenever I’m tempted by Chip or other similar savings.

Swipe

Arthurian said:

nottsphil said:

AndyTh_2 said:

Chip doesn't hold your money, they put it in Clearbank savings accounts (or Alica for older savings products) opened per customer, with £85k FSCS protection.

And that's the troubling thing for me. Clearbank don't have a numbered account with my name on it AFAIK. If they did then surely I would have a right to interact with it? So, how do we know that the FSCS won't simply apply the £85,000 limit to this single account, which when divided amongst savers might result in us getting, IDK, a penny for every £10,000 of our balance?

Years ago, someone in these forums had booked a cruise with one of those holiday companies which have promotional programmes on shopping TV channels.  They were shocked to lose their money when the company promoting on TV went bust.  The actual cruises were run by ABTA and ATOL protected companies, but because they had paid the shopping TV company, there was no protection.  That’s what I think of whenever I’m tempted by Chip or other similar savings.

Exactly and especially in the current climate. I'd rather steer clear of all these smaller online banks.

Band7

Swipe said:

Arthurian said:

nottsphil said:

AndyTh_2 said:

Chip doesn't hold your money, they put it in Clearbank savings accounts (or Alica for older savings products) opened per customer, with £85k FSCS protection.

And that's the troubling thing for me. Clearbank don't have a numbered account with my name on it AFAIK. If they did then surely I would have a right to interact with it? So, how do we know that the FSCS won't simply apply the £85,000 limit to this single account, which when divided amongst savers might result in us getting, IDK, a penny for every £10,000 of our balance?

Years ago, someone in these forums had booked a cruise with one of those holiday companies which have promotional programmes on shopping TV channels.  They were shocked to lose their money when the company promoting on TV went bust.  The actual cruises were run by ABTA and ATOL protected companies, but because they had paid the shopping TV company, there was no protection.  That’s what I think of whenever I’m tempted by Chip or other similar savings.

Exactly and especially in the current climate. I'd rather steer clear of all these smaller online banks.

You are certainly free to stay clear if something doesn’t sound right but FSCS is FSCS, regardless of the size of the bank or building society. The entire purpose of FSCS is to remove all risks as long as you stay within £85k per institution. As history proves, it is also a fallacy to think that big brick & mortar banks are safer.

grumbler

Band7 said:

Swipe said:

Arthurian said:

nottsphil said:

AndyTh_2 said:

Chip doesn't hold your money, they put it in Clearbank savings accounts (or Alica for older savings products) opened per customer, with £85k FSCS protection.

And that's the troubling thing for me. Clearbank don't have a numbered account with my name on it AFAIK. If they did then surely I would have a right to interact with it? So, how do we know that the FSCS won't simply apply the £85,000 limit to this single account, which when divided amongst savers might result in us getting, IDK, a penny for every £10,000 of our balance?

Years ago, someone in these forums had booked a cruise with one of those holiday companies which have promotional programmes on shopping TV channels.  They were shocked to lose their money when the company promoting on TV went bust.  The actual cruises were run by ABTA and ATOL protected companies, but because they had paid the shopping TV company, there was no protection.  That’s what I think of whenever I’m tempted by Chip or other similar savings.

Exactly and especially in the current climate. I'd rather steer clear of all these smaller online banks.

The entire purpose of FSCS is to remove all risks as long as you stay within £85k per institution.

TBF, their is no full clarity with this. You don't have direct relationship with Clearbank. You give your money to some intermediary that, in turn, puts it to the bank. In this respect I don't see much difference with, say, Revolut that keeps our money in some bank too. We go by the Chip's assurance that, AFAIK, was neither confirmed nor refuted by FSCS. At list least, AFAIK, there is no any confirmation on their website.

That said, I have money in Chip and don't have any problems with this.

Band7

grumbler said:

Band7 said:

Swipe said:

Arthurian said:

nottsphil said:

AndyTh_2 said:

Chip doesn't hold your money, they put it in Clearbank savings accounts (or Alica for older savings products) opened per customer, with £85k FSCS protection.

And that's the troubling thing for me. Clearbank don't have a numbered account with my name on it AFAIK. If they did then surely I would have a right to interact with it? So, how do we know that the FSCS won't simply apply the £85,000 limit to this single account, which when divided amongst savers might result in us getting, IDK, a penny for every £10,000 of our balance?

Years ago, someone in these forums had booked a cruise with one of those holiday companies which have promotional programmes on shopping TV channels.  They were shocked to lose their money when the company promoting on TV went bust.  The actual cruises were run by ABTA and ATOL protected companies, but because they had paid the shopping TV company, there was no protection.  That’s what I think of whenever I’m tempted by Chip or other similar savings.

Exactly and especially in the current climate. I'd rather steer clear of all these smaller online banks.

The entire purpose of FSCS is to remove all risks as long as you stay within £85k per institution.

TBF, their is no full clarity with this. You don't have direct relationship with Clearbank. You give your money to some intermediary that, in turn, puts it to the bank. In this respect I don't see much difference with, say, Revolut that keeps our money in some bank too. We go by the Chip's assurance that, AFAIK, was neither confirmed nor refuted by FSCS. At list, AFAIK, there is no any confirmation on their website.

That said, I have money in Chip and don't have any problems with this.

It is totally different to Revolut, where at present all deposits are 'safeguarded' rather than FSCS protected. See the FCA website for the difference between the two protection mechanisms. A. given provider or bank can, as an aside, provide FSCS as well as 'safeguarded' accounts. It is therefore important that people check whether their account is FSCS protected or 'safeguarded'.

Anybody who is of the view that CHIP might provide misleading information on their website should report their concerns to the FSCS.

grumbler

Band7 said:

grumbler said:

Band7 said:

Swipe said:

Arthurian said:

nottsphil said:

AndyTh_2 said:

Chip doesn't hold your money, they put it in Clearbank savings accounts (or Alica for older savings products) opened per customer, with £85k FSCS protection.

And that's the troubling thing for me. Clearbank don't have a numbered account with my name on it AFAIK. If they did then surely I would have a right to interact with it? So, how do we know that the FSCS won't simply apply the £85,000 limit to this single account, which when divided amongst savers might result in us getting, IDK, a penny for every £10,000 of our balance?

Years ago, someone in these forums had booked a cruise with one of those holiday companies which have promotional programmes on shopping TV channels.  They were shocked to lose their money when the company promoting on TV went bust.  The actual cruises were run by ABTA and ATOL protected companies, but because they had paid the shopping TV company, there was no protection.  That’s what I think of whenever I’m tempted by Chip or other similar savings.

Exactly and especially in the current climate. I'd rather steer clear of all these smaller online banks.

The entire purpose of FSCS is to remove all risks as long as you stay within £85k per institution.

TBF, their is no full clarity with this. You don't have direct relationship with Clearbank. You give your money to some intermediary that, in turn, puts it to the bank. In this respect I don't see much difference with, say, Revolut that keeps our money in some bank too. We go by the Chip's assurance that, AFAIK, was neither confirmed nor refuted by FSCS. At list, AFAIK, there is no any confirmation on their website.

That said, I have money in Chip and don't have any problems with this.

Anybody who is of the view that CHIP might provide misleading information on their website should report their concerns to the FSCS.

To report, this 'anybody' has to be an expert in this area. Most people aren't and don't have to do their own research on various types of trust accounts held by companies in banks. Most people, myself included, prefer to see some clear information on FSCS website without sending any reports or requests..

soulsaver

Just posted this comment in the EA discussion thread:
Chip:

When you make a deposit to Chip it isn't in Clearbank - it is 'instantaneously' transferred to Clearbank.
 
Chip say money held in Clearbank is FSCS protected; but you pay money to Chip which is then ported to Clearbank.

So, the funds are being 'ported' from Chip - not covered by FSCS - and 'Held' in Clearbank which is FSCS covered.

So first issue: In the event of 'failure' funds could be caught in the unprotected condition?

Chip doesn't say that the funds held in Clearbank are ringfenced by personal depositor, so one could theorise it's only Chip's eligible funds in Clearbank that is FSCS protected up to £85k total.

Now it's not the first time this has been discussed, and I'm sure Chip is aware of the doubters..

So if your savings (upto £85k) are protected 100% of the time, why doesn't Chip just clearly state that?

VXman

These arguments about protection or not apply to Raisin aswell. If you open an account through the Raisin website your money is protected by the bank your money is in not by Raisin.