How safe are your savings?
We are often asked for more information on various savings providers that are less well-known or new to the savings market. In this regular series of articles, we aim to turn the spotlight on these providers to give you more information about their background and history and why they are of particular interest in today’s savings market.
Alongside these articles, you may also find our Guide to Challenger Banks useful for more information on some of the banks that are seeking to break the monopoly of the big high street names.
We hope that you find this information useful and as always, if you have any feedback or suggestions as to who should appear in a future article, please let us know. You can call us on 0800 321 3581 or email [email protected].
The provider chosen this time is RCI Bank, following a number of requests for information from our clients and the fact that the provider has recently released some competitively priced savings accounts.
RCI Bank is the UK arm of RCI Banque and launched in June 2015. RCI Banque was formed in 1974 as the internal bank of Renault, the car manufacturer and is still privately owned by the Renault group today. The RCI Banque group has four online savings banks across Europe; in France, Germany, Austria and now the UK.
RCI Bank is the only bank in the UK savings market owned by a car company and its UK offices are located in Watford and Newcastle.
The key thing to be aware of with savings accounts from RCI Bank is that the provider is not part of the UK Financial Services Compensation Scheme, although savers are protected under the French guarantee scheme, the FGDR, up to the value of €100,000. Anyone looking to open one of the provider’s accounts will need to consider this before proceeding
Today’s Savings Market
When launched in June 2015, RCI Bank offered a highly competitive easy access account, the Freedom Savings account paying 1.50% gross/AER. Having matched the market leading easy access rate from BM Savings at the time of its launch, RCI Bank reacted to BM Savings’ replacement of that account with a better version (1.60%) by increasing the rate on the Freedom Savings Account to a market leading 1.65% on 19/07/2015. Unlike the account from BM Savings, where the higher rate applied solely to customers opening the new version of the account, the increase to the account from RCI Bank also benefitted those who already held the account, a rare occurrence in today’s savings market, where many providers are actually cutting the interest rates on savings accounts for existing account holders.
Recently, RCI Bank launched new 1 and 2 year fixed rate bonds to complement its easy access account. Paying 2.06% for 1 year and 2.35% for 2 years, the rates are competitive in today’s savings market, sitting in line with the market leader in the 1 year best buy table (Charter Savings Bank) and just behind the top account in the 2 year table (Secure Trust Bank 2.38% gross/AER).
If you would like further details on these accounts, please contact us on 0800 321 3581 to talk to one of our savings experts.
Application Process and Customer Service
All accounts from RCI Bank must all be applied for online, so this will not suit those who prefer not to use the internet. However, the application process appears to be straightforward.
Whilst it is still early days, with the provider only launching in June, we certainly have not been made aware of any negative experiences so far. Of course, as mentioned earlier, your thoughts and experiences about providers’ customer service are invaluable for us, so please get in touch to share any feedback you have.
A final word…
It is a simple fact that many of the best rates on the market today can be found amongst providers that are less well-known or that some savers may not have even heard of. Well-known providers rarely offer rates that allow them to feature in our best buy tables, as much as they have in the past, so in order to earn as much interest as possible, savers will most likely need to look at an alternative to the high street.
However one of the most important factors, as important as the rate of interest, is safety. Savings are supposed to be one of the safest places for your cash so choosing a provider that is a protected is a must when we recommend products in our best buy tables or to our clients.
We have deliberated about RCI Bank UK and whether to include them in our best buy tables. After doing our due diligence we believe the protection scheme is robust and merits its inclusion in our best buy tables. We would of course caveat that with keeping your money within the protection scheme limits, which in this case is the equivalent to 100,000 euros.
Although you can still earn up to 7% AER using high interest paying current account. Learn how here.
If there is a provider that you would like to see featured in a future article, please let us know. We are also keen to hear from you if you have any feedback about any provider’s customer service, good or bad! Please contact us at [email protected] to share your experiences.