Skip to main content

Why are business savings accounts so rubbish?

Like most people running a business, I have a business bank account. This is fine for doing the various transactions of business life, but it is useless if you have any money squirreled away - for example, to pay that evil Corporation Tax bill lurking months in the future. The standard business bank account doesn't pay interest. But no problem - my bank offers a business savings account.

Now when it comes to personal savings, I tend to shop around and change accounts for the best interest every year, but I've been with my current business savings account for about 10 years, so I thought it was worth looking for a bit more interest. I started searching and was horrified by what I found.

If you shop around you can get maybe 2.5% on a personal instant access account for the first year (admittedly then it will typically drop to 1% or 0.5%). But if you look at the instant access business savings accounts the typical interest rate is 0.05%. No, that's not a misprint. 1/20th of a percent. That is, frankly, an insult. I asked my bank why this was the case and they muttered about money being kept longer in personal accounts, but that's really beside the point. That's a ludicrously low rate.

The good news is the account I was with was already offering 0.5% and I found one from the same provider that provides just over 1% if you are prepared to give 10 days notice, which isn't usually a problem with business savings. If you want to take advantage it's Standard Life's business savings (part of Barclays). Yet even they hide this away in a filing cabinet at the bottom of a missing staircase, with notices up saying 'Beware of the tiger.' (Thanks, Douglas Adams.) It's quite difficult to find these accounts by doing a web search or looking on a comparison site. Is this a conspiracy? Why are the rates offered so terrible? If Standard Life can offer decent rates, why can't other banks? Colour me mystified.

Wordle by www.wordle.net
Labels:

Comments

  1. Anonymous5 April 2011 at 23:58

    Try the building societies - Saffron BS is paying 1.5% with instant access.
    This still does not answer the question though: Yes, why are business savings accounts so rubbish ? I would really like to know the anser to this.

    ReplyDelete

Post a Comment

Popular posts from this blog

Why I hate opera

If I'm honest, the title of this post is an exaggeration to make a point. I don't really hate opera. There are a couple of operas - notably Monteverdi's Incoranazione di Poppea and Purcell's Dido & Aeneas - that I quite like. But what I do find truly sickening is the reverence with which opera is treated, as if it were some particularly great art form. Nowhere was this more obvious than in ITV's 2010 gut-wrenchingly awful series Pop Star to Opera Star , where the likes of Alan Tichmarsh treated the real opera singers as if they were fragile pieces on Antiques Roadshow, and the music as if it were a gift of the gods. In my opinion - and I know not everyone agrees - opera is: Mediocre music Melodramatic plots Amateurishly hammy acting A forced and unpleasant singing style Ridiculously over-supported by public funds I won't even bother to go into any detail on the plots and the acting - this is just self-evident. But the other aspects need some exp
117 comments
Read more

Is 5x3 the same as 3x5?

The Internet has gone mildly bonkers over a child in America who was marked down in a test because when asked to work out 5x3 by repeated addition he/she used 5+5+5 instead of 3+3+3+3+3. Those who support the teacher say that 5x3 means 'five lots of 3' where the complainants say that 'times' is commutative (reversible) so the distinction is meaningless as 5x3 and 3x5 are indistinguishable. It's certainly true that not all mathematical operations are commutative. I think we are all comfortable that 5-3 is not the same as 3-5.  However. This not true of multiplication (of numbers). And so if there is to be any distinction, it has to be in the use of English to interpret the 'x' sign. Unfortunately, even here there is no logical way of coming up with a definitive answer. I suspect most primary school teachers would expands 'times' as 'lots of' as mentioned above. So we get 5 x 3 as '5 lots of 3'. Unfortunately that only wor
25 comments
Read more

Why backgammon is a better game than chess

I freely admit that chess, for those who enjoy it, is a wonderful game, but I honestly believe that as a game , backgammon is better (and this isn't just because I'm a lot better at playing backgammon than chess). Having relatively recently written a book on game theory, I have given quite a lot of thought to the nature of games, and from that I'd say that chess has two significant weaknesses compared with backgammon. One is the lack of randomness. Because backgammon includes the roll of the dice, it introduces a random factor into the play. Of course, a game that is totally random provides very little enjoyment. Tossing a coin isn't at all entertaining. But the clever thing about backgammon is that the randomness is contributory without dominating - there is still plenty of room for skill (apart from very flukey dice throws, I can always be beaten by a really good backgammon player), but the introduction of a random factor makes it more life-like, with more of a sense
6 comments
Read more