Zopa changing t&c’s

JazF

FYI received an email from Zopa regarding a change in their pots and interest rates. 

slinger2

Part of a general trend towards "tracker" rates. The current 4.70% for the 95 day boost isn't very competitive anyway, even it you can lock it in for another 109 days.

MichaelAP

slinger2 said:

Part of a general trend towards "tracker" rates. The current 4.70% for the 95 day boost isn't very competitive anyway, even it you can lock it in for another 109 days.

Surely it could though be beneficial with a 95 day pot? If the base rate falls and you are happy to place a large sum in a 95 day pot then immediately give notice it would at least be guaranteed 4.70% for the period.

slinger2

Under the current rules you are guaranteed the 4.7% for 109 days. When it becomes a tracker that period will be much shorter.

You can however get better rates with other providers.Eg investec 5.05%

refluxer

MichaelAP said:

slinger2 said:

Part of a general trend towards "tracker" rates. The current 4.70% for the 95 day boost isn't very competitive anyway, even it you can lock it in for another 109 days.

Surely it could though be beneficial with a 95 day pot? If the base rate falls and you are happy to place a large sum in a 95 day pot then immediately give notice it would at least be guaranteed 4.70% for the period.

Unfortunately not. On reading the T&Cs, it looks like Zopa will be able to change the rate of any boosted pots you currently have running which means it will work in a different way to the majority of conventional notice accounts that either give you notice of an interest rate change that is at least equal to your notice period, or allow you to close your account without giving notice.

To be fair, it looks like this is common practise for notice accounts that track the base rate but if you wanted one of those, it would make more sense to go with a bank like Oxbury or Oaknorth who track above the base rate (currently 5.14% AER for a 90/95 day fix) and not below it, like Zopa. Those two also give you a bit more notice of the change (up to 2 weeks for Oxbury and up to a month with Oaknorth, depending on what day in the month the base rate changes). 


From https://www.zopa.com/smart-saver-terms-update-oct-2024 

4.7: If you have funds in a Boosted pot and the base rate changes, the interest rates on your Boosted pot will change (up or down) in line with the base rate change. We’ll let you know the date your interest rate was amended, within 2 business days of the base rate change. Your new interest rates will be available to see in the Zopa app

This clause explains that if the base rate changes, your Boosted pot interest rate will change by the same amount within 2 business days.

slinger2

From an email:

"If you’re comfortable with these changes, you don’t need to do anything — our Smart Saver Terms will be updated automatically and will come into effect in 2 months for 7 and 31-day Boosted pots and 109 days for 95-day Boosted pots."

so there's a delay before the new tracker rules come into effect.