🔔 Don't be caught out by complex rules

"Hi Anna, I opened a new RBS 1.5% savings builder account yesterday. However, I am not particularly keen on it because it has such a low maximum deposit, and so many rules and traps that look easy to come a cropper, and therefore end up not getting paid the interest!" - Mr J

We agree and as there have been a number of press articles that suggest this is an account launched to compete with the Marcus Online Savings Account - presumably because the rate is the same - we thought we should make the ‘rules and traps’ clear to anyone who might be considering it.

In summary, your savings of up to £10,000 could earn 1.50% gross/AER and you can make easy access withdrawals whenever you like – but as Mr J above pointed out, interest is only earned in the months that the balance grows by at least £50. In any month that it doesn’t increase by £50, you will earn no interest at all for that month, which would therefore affect the AER rate.

So, although you can make easy access withdrawals whenever you like, this could in effect produce a penalty in the form of zero interest paid in that month, even if £50 is also deposited!

In addition, it is only available to RBS current account customers – so if you don’t have an RBS current account, you will need to open one.

Plus, remember that the maximum on which you could earn the 1.50% AER is £10,000 – so just a fraction of the £250,000 Marcus maximum – or indeed the maximum of all the other accounts in our easy access best buy table.

Any balance above £10,000 will earn a far lower amount of 0.20% gross/AER (as long as the balance has increased by at least the required £50 per month), which will dilute the overall interest earned.

So, assuming you increase the balance by at least £50 each month, if the overall balance is £20,000, you will earn 1.50% AER on the first £10,000, but just 0.20% AER on the remainder.

We would categorise this account as a  regular saver – but it won’t get into our best buy table, as far better regular saver accounts can be found elsewhere. And if you want easy access, there are simpler ways to achieve this without losing too much interest.

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