Partner Article

Natwest and RBS may charge firms

NatWest and Royal Bank of Scotland (RBS) have warned businesses they may have to charge them to accept deposits due to low interest rates.

Alan Sneddon, Director of Gale and Phillipson’s Dynamic Cash Management service, said: “This is not good news, but business owners and directors shouldn’t worry.

“The driving force for this decision is the potential for the Bank of England base rate to drop into negative territory. Mr Carney has previously given his assurances that this won’t happen. However each banking institution will take an independent view in setting their own rates. The resulting action could be a charge imposed for simply holding a firm’s cash reserves.

“Typically, corporate accounts only offer between 0.05% and 0.15% anyway. Cash management services can offer a solution to this problem. For example, there are rates on the market that pay 1.00 %( AER) on easy access accounts; 1.30 %( AER) on 45 day notice. Now is the time for firms to reassess how they manage their cash.”

Dynamic Cash Management is an innovative, industry-leading whole of market cash management service provided by Gale and Phillipson Ltd. Dynamic Cash Management selects the most suitable cash investments by actively monitoring the performance of savings accounts at more than 165 institutions. The service is more cost effective for clients investing over £70,000, whereby balances are switched when rates change and new opportunities arise, with all paperwork arranged on the client’s behalf.

Gale and Phillipson is an independent financial planning and investment management firm, dating back to 1905. The firm was formed through the merger of two well-established firms: jonathanfry plc and Easby Gale and Phillipson in 2015.

This was posted in Bdaily's Members' News section by Gale and Phillipson .