Investec Fixed Rate ISAS - unusual maturity condition

ashteadgirl

I applied for an Investec 1 Year fixed rate ISA yesterday and on reading t and c's after applying noticed that on maturity the interest appeared to have to be paid away into your linked account. this seemed really odd to me so went onto their chat and this was confirmed that on maturity the Isa transfers to instant access ISA with interest paid away to linked account. There is no alternative. Decided to talk to phone and told that number just switchboard no telephone support for online accounts and to go back to chat box if wanted to discuss matter.

Have done this and instigated a complaint as I have NEVER had an ISA account were the accrued interest has to be paid away to non ISA account. It seems mad to me as alot of peolple will wish to keep the total money ISA wrapped. Just putting this on here to warn people as the condition is quite well hidden in the informationn section.

Now in process of cancelling transfer and moving to a more sensible institution, just hope i mannage to do this as Principality not recieved transfer request and Investec say they have sent it so up to Principality. This this may be a fraught time sorting it out.

MeteredOut

I'm not sure what the basis of your complaint is since its in the T&Cs you agreed to. I doubt you NEVER having such an account is grounds for a complaint.

It's not very common amongst ISA providers, but Investec are not alone in doing this.

eskbanker

Certainly an unusual provision but not unique - I recall seeing it on here before with providers such as UBL (I think).

LeafGreen

I opened a 1 year fix with them in April of this year (£20K), and had not realised this was the case - but upon checking it does indeed appear that it is, so thanks for the heads up.

I guess it was in the T&Cs and I just didn't read them in enough detail. Quite annoying as that'll be £900 losing it's tax free status next year (and a bit of a double whammy with the regular savings tax rate increasing next year).

I can't really see a complaint going anywhere if it was indeed in the T&Cs, but good luck and let us know how you get on.

dunstonh

maturity the interest appeared to have to be paid away into your linked account. this seemed really odd to me 

It's not odd. A number of providers do it that way.

Not sure what you have grounds for complaining about. If that's the product they offer and those are the terms of the product, it is up to them. Just as it is up to you whether you wish to accept those terms. And with you cancelling, you have made the choice not to accept them.

 Just putting this on here to warn people as the condition is quite well hidden in the informationn section.

I disagree that it's quite well hidden. It is on page 1 of 4 on their product term sheet. The product term sheet is what you always look at when buying a new financial product. It contains all the key facts about the product without all the longer detail.

It also repeats it on page three under the section "How interest works".

ashteadgirl

The term raising a compalint was what Investec suggested when I said I wanted to feed back that I thought this was an usual way to treat interest. I am not looking for compensation just wanted to feed up the management that did not think this was a particularly good product.

I put the information on here to help other people as i certainly missed it initially.

For those chastising me yes i should have noticed but also it is the first time I have come across a product like this and am not a novice at isas or savings.

DRS1

I find it curious that people don't think it is an odd provision to have in an ISA. It is a stupid provision to have in an ISA. Perhaps it was dreamt up by the same genius who thought it would benefit S&S ISAs if the government reduced the allowance for cash ISAs.