It's better than other peer-2-peer lending IMO but peer-2-peer lending is outside FSCS. At the end of the day, the lending contract is with you and the borrower so you're taking the same risk as banks do. It's hopefully all statistics. A percentage will default and you allow for that. So you lend a £100 at say 8%. 1% defaults so your return is just 7%. Banks after all manage to make a tidy profit.

Ratesetter is easier to use as the provision fund handles bad debts and is ~5x the expected bad debt rate. In other peer-2-peer lending you have spread the risk yourself so need to lend to 100 people for a 1% bad debit rate which is trickier to manage.

But you have to decide on your comfort zone. Stock market has risks, as does peer-2-peer. Banks are risk free but with inflation and rates as they are you're losing money not making it.

I contacted them on Wednesday and they said

"I apologise for the delayed response.

Please note our products are no longer available to new customers.
If you can provide your phone number and contact details I will contact you to discuss any new revised products that may suit your business needs.

If you are an existing customer, I can send you the application pack via email or post.

Thank you



Kind regards
XXX
Business & Broker Support
Anglo Irish Bank Corporation Limited
10 Old Jewry
London EC2R 8DN"

I am hoping to teach some classes and had initially been planning to make it a non-profit but it is too complicated to start this way so am just going to go for a small business just now. I am trying to figure out the bank accounts. I won't be dealing with much money, but need to put in cheques and probably cash too. I have heard bad things about Santander but they are free. Any advice or suggestions would be welcome.

Natwest's Direct Reserve earns 1.10% gross (including a 1% bonus for 12 months) - no great shakes by any means, but better than 0.4%! However, how "seamless" it would be without having a business current a/c with them I don't know, or even if you could open one without having your business a/c there. Didn't arise with us as we bank with Natwest anyway, so we could have one.

http://www.natwest.com/business/products/savings/instant-access-accounts/direct-reserve-savings-account.ashx

We opened our DR last year and were expecting the bonus to drop off in about a month from now; but we 'flew a kite' and asked our manager a few weeks ago if there was any way it could be extended, and after checking with someone he said we should be getting a letter through before it expires offering an extension anyway, giving the impression this happened as a matter of course. Whether that's correct I've no idea... I'll believe it when I see it TBH as the terms when opened were certainly that it was only for 12 months and would then fall to the basic miserable 0.10% gross (up to £25k, and hardly any better above it - worse than your 0.4%!).

If so, we're stuck with it unless we could find a better replacement elsewhere (or unless we moved our business a/c too, which we don't really want to do). But like you, instant TF between accounts is a big attraction in our situation, overriding other considerations to a large degree. A notice account would be out of the question, and anywhere without Faster Payments outwards probably doubtful also (which a savings account held in isolation elsewhere probably wouldn't be able to do anyway).

Yes .

If you have £30K+ available for deposit and make no withdrawal in the first 12 months, Santander's Business Reward Saver is currently offering 2% Gross/AER, which includes a variable rate bonus for the first 12 months of 1.00% Gross/AER. The rate drops to 1.84% Gross/AER (including bonus) if you make one withdrawal in the first 12 months. See the site for all terms & conditions.

One option, if you have surplus cash in the business, would be to make early payment of any tax liabilities. HMRC pays interest on most payments received before the due date. For instance, if you pay corporation tax early, they pay 0.5% interest, which is pretty low, but better than most banks are offering at present.

We are looking for a business savings acccount that actually pays us some interest! Why don't the banks do any of these accounts? We need fairly quick access and cannot tie money up for a year or so, why can't we get the 2.5% or 3% that a personal saver has?

Baffling, isn't it? It's not as if they need to provide any different service to the business than an individual. The business just wants to transfer some money into the account, get a competitive rate of interest, then withdraw it when they need it. Perhaps there is some sort of hassle involved in dealing with a business in comparison with dealing with an individual, although I can't think what it is.

I have just thought, perhaps the reason they don't pay decent interest on business savings accounts is that businesses tend to withdraw their money more quickly than individuals. Although an individual can obviously withdraw from an instant access savings account whenever they like, perhaps they tend to leave their money invested for long periods? In contrast, if businesses have surplus cash they will either use it for business purposes quite quickly (to pay corporation tax, or VAT, or another creditor, or to buy a fixed asset) or, if it is not needed for the business, it will be distributed to the shareholders.

I know this is an old post but if you can keep a minimum balance of £5k and give 100 days notice, this gives a fairly reasonable 2.9% https://www.shawbrook.co.uk/business/save/notice-product/100-day-notice-business-savings-account/

ING now offering 2% easy access. After 12 months, falls to 0.5%.

We've got a large part of ours with Investec, at something like 2.13%.

They have a top 5 account, which tracks the average, and tells you the top account names, however the conditions of these, I haven't looked into.

CK

I've been using Allied Irish Bank (formerly Anglo Irish in the UK) for some time, but just received notice that they are closing my business accounts, as they are pulling out of the business banking market in the UK. Any good suggestions for an alternative? As ever, getting a decent rate is very hard for business savings.

Depends what you want and on the size of your business.
For modest size businesses there is Santander at £7.50 a month - but their customer service is excremental (have I just invented a new word? ) .
Co-op is free within certain limits if you join the FSB at about £120 a year for sole traders - more for businesses with employees. For that annual fee you do get the accountancy costs of a tax investigation covered plus legal advice and a few other things that I've forgotten as I would never be likely to need them. Tax investigation insurance alone can cost more than that so I reckon it's fair value. Assuming £120. The £120 is tax deductible so after basic tax and NI are allowed for, it really only costs about £80. Additionally, Co-op pay you £25 a year for banking with them so the real cost of the account is £55 a year with an insurance policy thrown in.
Obviously the interest on both of the above accounts is derisory but I suppose the £25 helps.
Beware of Santander is my advice. A bunch of wideboys and spivs who are always looking to screw you over for higher fees.
Can't comment on other banks as I've not used them.

Got a letter today from Investec saying they were discontinuing the High 5 business deposit account. If you take your cash out before 31Dec they will pay you a bonus of £300.
Any recommendations for an alternative account? I am gonna have to do some research over the weekend.

It seems that the best equivalent account on offer today is 2.93% with United UK Bank. Does anyone know much about this bank? It is covered by the FCSC scheme - but there is not much information about it. Its quite a good rate compared to other business deposit accounts with similar notie periods. Does anyone have any thoughts?

The FSCS is primarily there to aide consumers, but smaller companies are also included (but larger businesses are not usually covered).

A quick glance at term 35 of their general terms & conditions confirms that United UK Bank is covered by the usual terms of the FSCS.

I assume you mean United Bank UK. They appear to be owned by the Pakistani government.

When does the Allied Irish one run out - need new account soon