PLUM ISA, want Current Acct access too!

chrispb1313

I have transferred my full £20K allowance into Plum's high-rate ISA from a matured Santander ISA. Plum insist that they need access to my Current Acct at Santander in order to accept the ISA.
I've never heard of this before and wonder what the plan is. I am about to say "No", and withdraw my funds.

Any idea what it's about?

Ayr_Rage

Many providers need a linked current account, so nothing unusual or dangerous about doing as they request.

It is very likely detailed in the full Ts and Cs which, of course, you read fully before selecting the "agree" button.

Don't cut off your nose to spite your face !

friolento

I’d be more concerned about the lower rate you get for transfered-in ISAs

FIREDreamer

friolento said:

I’d be more concerned about the lower rate you get for transfered-in ISAs

Looks like transfers in miss out on the one year 0.88% bonus.

eskbanker

chrispb1313 said:

I have transferred my full £20K allowance into Plum's high-rate ISA from a matured Santander ISA. Plum insist that they need access to my Current Acct at Santander in order to accept the ISA.
I've never heard of this before and wonder what the plan is. I am about to say "No", and withdraw my funds.

Any idea what it's about?

Plum do this as standard, stemming from their origins as a savings provider using automated topups from bank accounts, but I'm not sure how you got as far as opening the ISA and completing a transfer before this was requested.

In itself it's not inherently risky but some do feel uncomfortable about it, so they address concerns in their FAQs:

https://help.withplum.com/en/collections/1485734-bank-linking

friolento

FIREDreamer said:

Looks like transfers in miss out on the one year 0.88% bonus.

That's the reason I gave the Plum ISA a miss.

400ixl

Many ISA's use the linked account as an extra security measure. If the funds can only be withdrawn to that account then anyone trying to cash it our will have to have access to both accounts to successfully be able to access the money.

Its likely the provider of the ISA today also had a similar requirement, but that link was done as part of the funding process, so less obvious.

eskbanker

400ixl said:

Many ISA's use the linked account as an extra security measure. If the funds can only be withdrawn to that account then anyone trying to cash it our will have to have access to both accounts to successfully be able to access the money.

Its likely the provider of the ISA today also had a similar requirement, but that link was done as part of the funding process, so less obvious.

There are two different linkage processes being referred to here - as you say, it's normal for there to be a linked account, in the sense of one nominated to, and recorded by, the ISA provider, from which deposits will be accepted and withdrawals paid.

However, the Plum model entails establishing an Open Banking connection directly to the bank account, as explained in the FAQs linked (in another sense!) above....

dunstonh

I have transferred my full £20K allowance into Plum's high-rate ISA from a matured Santander ISA. Plum insist that they need access to my Current Acct at Santander in order to accept the ISA.
I've never heard of this before and wonder what the plan is. I am about to say "No", and withdraw my funds.

Its commonplace.  With investments, nearly all do it.  With savings, many do it.   Its all about making sure the bank account on withdrawals is validated at the outset.  They will only ever pay out to a validated account. 

Why would you say no to that safeguard?

Ayr_Rage

CHIP offer the use of the Open Banking system as well, it is safe and yesterday very fast when opening my cash ISA and funding it from Santander.

friolento

Ayr_Rage said:

CHIP offer the use of the Open Banking system as well, it is safe and yesterday very fast when opening my cash ISA and funding it from Santander.

Chip is lightning fast, as usual.

Except for ISA transfers-in, which they still don't offer at all.