New research has revealed that two major personal and business bank account providers treat their new ISA customers much better than their existing ones, as new savers are offered rates up to 0.65 percentage points more for the identical offering.
Both RBS and NatWest pay identical interest rates on their one-, two-, and three-year ISA deals of 3.25 per cent, 3.7 per cent, and 3.95 per cent respectively. However, the only savers eligible for these rates are savers switching their ISA from their current provider.
Loyal NatWest or RBS customers are completely exempt from these rates, unless they transfer cash in from a competitor, a fact that flies in the face of the usual course of business of providers offering identical rates to both its new savers and its existing ones. However, loyal RBS and NatWest savers are instead only offered one year rates of 2.6 per cent, and two and three year rates of 3.5 per cent and 3.7 per cent respectively.
Industry experts don’t quite know what to make of the disparity between the rates offered to new and existing savers. Many attribute the move on the part of the providers as a bold-faced attempt to drive new ISA take up at any cost, up to and including short-changing their loyal savers in their zeal to increase deposits.
In related news, Sainsbury’s Bank has launched a new taxable account with a 2.5 per cent interest rate (2 per cent after the taxman takes his toll). There is no introductory bonus rate on the saver, which means customers need not worry that their returns will evaporate if they bide their time and keep their cash within the account for an extended period of time.