Chip, the clever savings app that has helped its users put aside more than £150m to date, has begun the roll-out of Interest Accounts in a move towards democratising savings.
The first savings account to be available via the new platform is eligible for the Financial Services Compensation Scheme (FSCS) and offers a highly competitive easy access rate of 0.90% AER (Annual Equivalent Rate). The rate is above inflation and significantly higher than the Bank of England’s base rate. The company expects to make more rates and accounts available soon, including market-leading notice accounts.
The goal of Chip’s new platform is to make interest smarter and to fully automate savings accounts. The technology behind the platform will enable Chip to negotiate highly competitive rates on behalf of its users and to combine the savers’ money into a trust account. The more money in the trust account, the better the rates that Chip will be able to negotiate from the banks. As a result, all Chip users – regardless of whether they have £5 or £5,000 in their account – will be able to benefit from the services normally only available to high net worth individuals with very large deposits.
Interest Accounts, which are being rolled out gradually due to high demand, will allow Chip users to open a new savings account with a bank with just a few taps. Users can deposit, withdraw, and track the performance of their savings all within the Chip app. Savers can initially deposit up to £5,000 into their account, but this cap will be lifted to the full £85,000 limit for ChipX users once the update launches later this year. The interest is paid daily and added to the user’s balance, which they can withdraw as soon as it is available.
Chip’s Chief Executive Officer, Simon Rabin said, “Millions of people in the UK have less than £100 in savings, leaving a huge chunk of the UK too reliant on credit, unprepared for a financial shock and not sufficiently planning for their financial future.
“And even if you do have savings, for the last decade it has been all but impossible to find a risk-free savings account that offers any kind of return. You can’t rely on banks to deliver, so this has left a problem for Chip to solve.”
“With clever AI and a radical approach to banking technology, we’ve helped tens of thousands of people who couldn’t, or wouldn’t, save up. We’ve reimagined what savings accounts should be, and are now building Interest Accounts.
“This isn’t just one savings account – it’s a platform that negotiates better rates on your behalf as you sit back, save and earn interest. We don’t think people should have to spend hours trawling comparison sites, filling out form after form, and opening multiple accounts, so we’ve built something that’ll do everything for you at the push of a button.
“The 0.90% easy access rate is only the first of many Interest Accounts. We’re already fighting to bring our users better rates, more savings account types and FSCS eligible products. We’re committed to owning the savings space and we won’t rest until Chip is universally known as the place to access the best rates on secure savings.”