Savings account to ‘blow the competition out of the water’ – JPMorgan Chase launches deal in UK | Personal Finances | Finance
Reviewing the product, Sarah Coles, Personal Finance Analyst at Hargreaves Lansdown, said: âChase’s new checking account has some really bright whistles and bells, which work particularly well for certain types of clients. Unfortunately, if they are too effective to attract money to the UK, these benefits may well be reduced.
JP Morgan is the latest US investment bank to play a role in the UK market. The size of the company means it can afford to come up with an attractive proposition, but being part of a larger investment bank could cause it headaches if it attracts too many clients. This might end up having to remove some of the more attractive features.
The rules introduced after the financial crisis aim to protect customers, by separating retail banking from wholesale banking. Banks with a big foot in each camp are subject to the rules of ringfencing. Only by keeping their balance sheets below Â£ 25 billion can they get around the rules that apply to them. Compare that to big players in the UK, like Barclays, which has Â£ 287 billion on the balance sheet.
Marcus was in the same boat. When the Goldman Sachs brand entered the UK savings market, it offered a leading account in the market, but it attracted so much money that he had to cut the rate to avoid going over that limit. Chase might not hit the limit so quickly, as checking account balances tend to be lower than savings balances, but if it’s a smash hit, he’ll hit the cap. The features of this account work best for big spenders who don’t need an overdraft and are willing to change regularly. So, before you consider a light switch, it’s worth being honest with yourself about how you plan to use it.
âUntil next year, there is no overdraft on this account, which will rule it out for anyone who occasionally dives into the red, at least for now. The 1% cashback on all purchases during 12 months is a godsend, mostly because it’s not capped. It’s much more generous than the current account competition, and comes with the added bonus that there are no charges on the account. to eat in that cashback. However, it only lasts for one year, so if you sign up for cashback, and don’t change it, you will lose this benefit.
âSavings interest is also very attractive. When you spend something on the account, you can round it up to the next Â£ 1 and that money is placed in a separate pot, which earns five percent interest. used to saving and the rate is much higher than the best regular savings accounts and alternative checking accounts.
However, other checking accounts work differently, which means that some people will end up getting more interest in an alternative account with a lower rate, so you need to figure out which one is best for you. savings are only available for the first year, so to get the most out of them you need to change locations after 12 months.
âThere are still great benefits for non-changers and small spenders, including the fact that you can use it abroad without paying any fees (including for cash withdrawals) and get the rate Mastercard exchange rate. If you are happy to spend time with the app on a regular basis, then the separate jars for different types of expenses are a handy budgeting feature – although you have to use the app whenever you want to change where you take it from. ‘money. information available through the app to help you track your spending.