Chip savings 23 February at 11:07AM edited 23 February at 11:10AM in Savings & investments 12 replies 1.3K views

baser999

I’ve recently opened a savings account with Chip, with a relatively small deposit of £2500. There have been a few teething problems logging into the account using my iPhone, but apart from that there’s not enough reason to make me close the account.
What I can’t quite get my head around though, and I’ve read their website a couple of times, is the whole business of ‘auto saves’ and in this respect I’ve had an email today saying “I’ve just auto saved £x”  How? Does this money get added to my account balance at some point? Am I right in thinking that Chip might be simply making use of funds that they see as lying otherwise idle in my linked account?
Am sure it’s relatively straightforward but just can’t understand it so a response for this layman would be appreciated. Thank you

PloughmansLunch

Chip uses Open Banking and AI to decide how much it thinks you can spare, then pilfers from the pockets of your connected bank account. It's automatically 'on' in the settings but easy enough to turn off.

baser999

So it ‘pilfers’ from my linked account? Will the balance on my linked account therefore go down by that amount? 

dgpur

baser999 said:

So it ‘pilfers’ from my linked account? Will the balance on my linked account therefore go down by that amount? 

Yes it will. The money transfers from your linked account.

Band7

I would suggest you turn off autosaving as they charge you for it. I don't see the point of it, and I think it's quite cheeky of them to default you into it. But they do warn before they plan to take the first payment (on the same day!) and it's easy to turn off.

n15h

I remember when it used to free until they introduced charges for auto-saves a couple of months ago. Their auto-save helped me to build my savings from scratch and build up a fund for emergencies / holidays over the last couple of years.

Chip is connected to your linked account using open banking, and it looks at your balance/usage and works out how much it can save. That amount is then automatically transferred from your linked account to your Chip account and shows up in your Chip app after a few days (think of it like a card payment - the money leaves your account straight away but takes 2-3 days to show up in your statement).

This process to look/work out/save is repeated by Chip every 4-5 days. The amount is saves fluctuates each time depending on your usage/balance of your linked account e.g., it may save £100 on one day and £46 the next time.

You can also choose the level of the minimum or maximum you want Chip to save - and it will work out the amount to auto-save within this level (again the actual amount will fluctuate).

Once you see how much on average you can save each week/month, you could look to switch off the auto-save function and just transfer the money yourself manually - you can do it in the time it takes for the kettle to boil! Save yourself on fees and continue building your savings pot - just a suggestion which I've been doing since Chip started to charge.

baser999

Thanks everyone, understood now. I notice the amount of autosave has indeed come out of my linked account and appears in the Chip prize savings account. Neither account was earning interest so nothing gained, may just keep an eye on it for now.

Band7

baser999 said:

Thanks everyone, understood now. I notice the amount of autosave has indeed come out of my linked account and appears in the Chip prize savings account. Neither account was earning interest so nothing gained, may just keep an eye on it for now.

I might be wrong but I don't think the CHIP prize saver is FSCS protected. Would be a total red flag for me

(The CHIP instant access saver is FSCS protected)

masonic

Band7 said:

baser999 said:

Thanks everyone, understood now. I notice the amount of autosave has indeed come out of my linked account and appears in the Chip prize savings account. Neither account was earning interest so nothing gained, may just keep an eye on it for now.

I might be wrong but I don't think the CHIP prize saver is FSCS protected. Would be a total red flag for me

(The CHIP instant access saver is FSCS protected)

They say that it is here: https://www.getchip.uk/savings-accounts/prize-savings-account

Even with FSCS protection, it is a fairly rubbish product.

Aside: good to see they've now removed the misleading claim about this account I reported them to the FCA and ASA about

Wooly1571728

Their new Savings account works well and the rate is good, but the opt in to autosave is underhand. There is a small charge, your money is unavailable for a few days and does not earn interest in the ‘prize’ account it ends up in. I got a notification on the day the autosave was due to happen and switched it off in the app, but the transaction can’t be cancelled.

Band7

Wooly1571728 said:

Their new Savings account works well and the rate is good, but the opt in to autosave is underhand. There is a small charge, your money is unavailable for a few days and does not earn interest in the ‘prize’ account it ends up in. I got a notification on the day the autosave was due to happen and switched it off in the app, but the transaction can’t be cancelled.

Agree, they shouldn’t be defaulting to auto-saving - - and not tell you about it until the day they plan to take the first payment. You hav a few hours to switch it off and to stop any money being taken but if you don’t, for whatver reason, see the notification in time, you might have the first lot taken unknowingly. CHIP probably also bank on people not noticing for a long time that they are autosaving.

The recommendation on this forum has been for quite some time to switch off autosaving immediately after opening the instant saver. Unless you do want to pay them for some reason to do your saving.