Increase in online accounts and bonds to meet demand for online financial services

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Written by Ray Clancy

Friday, 27 August 2010 09:09

New products for savers and investors who want to manage their finances online are being launched by the Post Office.

It is expanding its savings range with the new Online Saver account and an online bond to give consumers more alternatives to High Street banks. Customers can only apply online, but this reflects a growing demand for online financial services, it says.

Post Office director of savings and investments, Richard Norman, said it is part of an overall plan to expand its products to meet the different needs of customers.

‘By launching the Online Saver, we are reinforcing our commitment to offering competitive rates and account flexibility to a wider range of customers. The Online Saver complements our existing range of branch savings accounts and helps to provide greater choice for the growing number of online savvy savers. This marks a further step in increasing our financial services proposition and giving people a serious alternative to high street banks,’ he explained.

The Online Saver is paying 2.75% AER variable including a guaranteed 12 month bonus. ‘The savings account is perfect for savers who want to apply for and manage their savings exclusively online, whilst benefiting from a great rate of interest and absolutely no withdrawal restrictions or penalties,’ said Norman.

There is no limit on the number of withdrawals or the amount that can be withdrawn, with no notice period or penalties and it has a minimum investment of £1 and a maximum investment of £2 million. Interest can be paid either monthly or annually. Additional funds can be transferred at any time by a direct debit card or transfer from a nominated account.

Customers can apply for an Online Saver at the Post Office’s website using an online application form that takes less than 10 minutes to complete. The initial deposit is made during the application and once customers have completed the process their account number is provided on the spot.

The launch of the Online Saver closely follows the launch of the Post Office Reward Saver in July.

The Post Office has also launched a new Online Bond, which pays 2.80% AER, fixed for a one year period. The minimum single deposit to open the account is £500 to a maximum investment of £2 million. Interest can be paid either monthly or annually and it has no additional deposits or withdrawals during the one year fixed term. Early withdrawal of money available but will be subject to a breakage fee.

To apply for either product, customers must be a UK resident and aged 18 or over and they are not available to residents in the Channel Islands and the Isle of Man. Investors need to have a valid email address and be able to provide the account number and sort code of a UK Bank or Building Society current account in their name(s). The account must offer Direct Debit payment facilities and will then be the nominated account linked to the Online Saver or Online Bond.