Is The Banking Industry Stirring Or Dying?
A few days ago, I reported about a new approach to retail banking from TSB. Yesterday, The Times carried a big advert detailing everything.
If I was with a dinosaur bank, I’d certainly think about moving, as I meet their conditions for interest and because I could try before I moved everything.
Yesterday too, I heard a report at 05:30 in the morning from PwC, that a quarter of all bank branches will be closed. I actually think that is a low figure, if the amount of traffic you see in branches round here is anything to go by!
My friend, David, saw the writing on the wall decades ago.
Payments To Mobile Phone
They have just fully announced, that you’ll soon be able to send payments to a mobile phone number. The system is called Paym.
My bank, Nationwide, won’t be bringing it in until next year, but I’m not sure about if I would use the system.
For instance, will these points be covered.
1. At times, I use a simple mobile phone, like one of my Nokia 6310i.
Can you just send money using a simple text?
If you can it would enable those who don’t want a smart phone to use the system.
It would also mean that a stolen phone might lead secrets to fraudsters.
2. Can you send payments from an on-line account to a mobile number enabled account?
3. Could I send money to a charity and get Gift Aid added?
Knowing the two words banks and innovation rartely appear in the same senytence, I suspect the system will be designed like a colander.
Is This An Innovative Approach From TSB?
I picked up this article on Moneywise this morning. The headline is.
TSB launches current account paying 5% interest
The 5% is only available on your first £2,000. As a comparison, my year-to-date figure on Zopa for around £150,000 is 4.94% at the moment, after all bad debts and charges.
But it was this that caught my eye in the article.
TSB will also allow customers to ‘try before they buy’ in that it won’t insist customers transfer all direct debits and standing orders to the new Plus account immediately; indeed, there is currently no timeframe for when direct debits must be ported across.
One of the reasons, I’ve not moved to another bank, is that I’d like to test drive the on-line systems first. To me, ease-of-use and copious information are two of the most important things in any on-line account or system. So being able to check these without commitment is very important.
So as we seem to be seeing a features race in banking, you could say we live in interesting times.
A Must View Web Site For Savers And Investors
Out of curiosity, I wanted to find out, what was the rate you’d got on savings in 2008.
So I searched Google and found this page on a web site called Swanlowpark. This is the first statement on the home page.
This website centres on one theme: how well have your savings kept their value when compared to inflation.
Website is not-for-profit, there is no advertising.
Looking at the page for annual savings rates, there are some interesting figures. Draw your own conclusions or read the author’s comments here.
Institutional Bank Transfers Have Really Got Better
Today is a Monday and I was surprised to see my monthly pension payment had arrived in my bank account overnight.
A few months ago, the transfer would be in a pending pot, but I wouldn’t have been able to use it for probably three days.
I could blow it all today, on a wheel nut for a Lamborghini.
The only users in this process are the banks.
I always remember my friend, David, who rose to the top of a major clearing bank, telling me that they got a third of their profits from overnight money.
So they won’t be getting the interest payment, when they lend out my pension money for two days. Unless of course, they lent it out for Friday and Saturday nights!
Peer-To-Peer Lending To Be Allowed in ISAs
The blog on Zopa has just reported that peer-to-peer lending will be allowed in the new ISAs. These new ISAs were announced in the Budget. Here’s part of the blog post.
Fantastic news for savers today as peer-to-peer lending will soon be included in ISAs as announced by George Osborne in the Budget today. The peer-to-peer ISA is an extremely exciting saving option for UK savers – enabling them to grow their money much faster, with reliable and safe returns.
By lending through Zopa with an ISA, UK savers will be able to make at least 2.5 times more interest than the sub 1.6% cash ISAs from banks with the same tax free benefit. Unlike other riskier stocks and shares ISAs, a more reliable and predictable Zopa ISA would allow every saver to become a millionaire under 30 years at the current rate of 5% if they used their full ISA allowance and would double their savings to £2m by saving for a further 11 years. Meaning that by 2044 you could be aZopa millionaire with over £649,000 in interest alone!
So after annoying insurance fat cats earlier, he’s now produced a nasty little surprise for that wunch of bankers, who like to sell underperforming investments, or products that nobody needs or wants.
The Increased Speed Of The Zopa To Nationwide Transfer
I needed to remove some of the excess interest and repayments in my Zopa account to top up my Nationwide current account.
The last time, I looked at the speed of this, it took three or four days before, it was fully documented in my bank account and available for use.
I initiated the transfer at 06:43 on the 19th. I know the time precisely, as Zopa send a check e-mail on every requested transfer. The payment arrived in my bank account sometime before 06:00 this morning. So it was definitely under forty-eight hours.
Remember too, that I’m only siphoning off interest and repayments from Zopa. In a typical month you get upwards of five percent of your investment in Zopa, available for withdrawal, without cashing in any loans.
I’ve used Nationwide and Zopa as an example here, but I suspect most other reputable institutions, companies and individuals are the same.
I think the only thing that will happen to this sort of transfer in the future is that it will get faster.
Nationwide’s New Credit Card Statement
I received my on-line credit card statement from Nationwide yesterday and it has been simplified in their new web site, so that it is now very easy to see how much you need to pay for either the minimum amount or to avoid any interest charges. In the past, you sometimes had to guess the latter.
This means that I can get my cashflow more precise.
So are we going to see a features war between banks, as they make their web sites better to attract more customers?
After all, when you make a major purchase, like a car, a washing machine or a new partner, you carefully check out all the features! But unless you actually move your account, that’s a bit difficult with banking. Where is the test-before-you-buy feature? With peer-to-peer lending sites like Zopa and its ilk, you can experiment with a small sum, before you actually make the decision to move your savings there!
Certainly, unless they do something horrendous, I can see no reason at present to move my account away from Nationwide.
The End Of Cheap Credit Cards?
This question is posed in this article in the Daily Telegraph, as RBS/NatWest ends cheap introductory deals.
About time too, as why should I as a UK taxpayer and part owner of so-called bank RBS, subsidise the irresponsible debts of others?
Nationwide Updates It’s On-Line Banking
Nationwide has brought in a new on-line banking web site, which seems to go some of the way to meet some of my objections about lack of information.
As an example, I’d setup a single payment to pay a credit card bill for the 13th March. Until the start of this week, the money would have been debited from my account at midnight and marked in my account by an anonymous entry, just giving out how much I’d paid. But this morning, the money had gone from my account and the entry gave full details about the transaction.
So Nationwide seems to be getting closer to my ideal of a money transfer company, where I can collect all my incoming payments and organise all of my outgoings.
The Anonymous Widower 