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Product Focus: Incentive Accounts

Product Focus: Incentive Accounts

Category: Savings

Updated: 04/08/2009
First Published: 03/08/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The lure of the mid season sales is sometimes hard to resist and many savers may be easily swayed to dip into their funds to bag a bargain.

In order to help account holders curb temptation, three high profile providers have recently launched deals which restrict the number of withdrawals a saver can make.

If the permitted number of withdrawals is exceeded, the saver will incur a drop in the rate of interest. Here is a snapshot of the best deals launched recently.

Lloyds TSB – Incentive Saver

This deal is variable for 12 months, paying a rate of 3.00 per cent. This account doesn't require any notice to access funds, although for each month where there is a withdrawal, interest will be lost on the full balance for that month. The minimum investment is £1, while savers will only receive interest on the first £50,000. No interest will be paid on any of the balance over this amount. Account holders must open or have an existing Lloyds current account.

West Bromwich Building Society – No Notice Saver Direct

West Bromwich Building Society's No Notice Saver Direct deal pays a rate of 2.80 per cent, guaranteed to be at least Bank Base Rate until 30th April 2010. Customers are permitted to make three withdrawals a year, by BACS payment to a nominated account. If more than three withdrawals are made in a year or the account falls below £1,000, it will attract a rate of 0.05 per cent. Investments range from £1,000 to £1 million. A monthly interest option is available which pays a slightly lower rate of 2.76 per cent.

Halifax – Guaranteed Saver Reward

This deal pays a guaranteed rate of 2.60 per cent, including a bonus of 2.10 per cent for 12 months, although savers holding a qualifying current account, from £2,500, will enjoy a higher rate of 2.80 per cent. Four withdrawals are allowed during the 12 month reward period, although if savers exceed this restriction, the rate and terms of the deal will revert to that of the Guaranteed Saver deal, which is 0.50 per cent. Investments range from £2,500 to £9 million.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.