Business Savings Accounts

[d000hg]

It has rather caught me off-guard that as interest rates rose, you can actually get non-trivial business savings rates now. I always have a HSBC BMM account which pays a pittance (.1%) so I stopped using it, but looking around I see rates from 2% to in excess of 4%.

With very few, predictable expenditures, I can potentially keep the bulk of company money in a savings account and make a few grand a year. I'm kicking myself to have been remiss in this tbh.

Rules on interest being somewhat varied - some allow instant access but will reduce interest if you use this facility - I'd like to hear any recommendations and advice. Tide looks somewhat the obvious winner, but too good to be true?

Both my contractor Ltd and my wife & my other business accounts are with HSBC and have been sitting with 6-figure balances somewhat stably. I guess there's no reason a savings account should be with the same bank though it's slightly more convenient. HSBC only seem to offer about 2% by their "Kinetic savings" option and not needing another login doesn't seem to justify £1000+ per year

[alphadog]

I'm getting 4.6pc with HSBC business money market accounts. Need to fix for 1 month or longer, I think the minimum is 50k to get good rates. You have to phone them to set it up, but it's easy and the accounts appear on your existing business internet banking, no extra logins required.

[d000hg]

I'm getting 4.6pc with HSBC business money market accounts. Need to fix for 1 month or longer, I think the minimum is 50k to get good rates. You have to phone them to set it up, but it's easy and the accounts appear on your existing business internet banking, no extra logins required.

I hadn't seen that one, or had misread the details. Thanks. So if you withdraw do you simply lose interest for that month or is it more punitive?

[Paracelsus]

I went with Allica for a 4.5% 95 day notice account, FSCS covered.

You can get more via money market funds e.g. Wise 4.67% GBP/5.08% USD, but my accountant advised these would be considered investments and as such would have consequences on the nature of my LTD (close investment company) if more than 25% of cash was put in. For the sake of 0.17% (or 0.5% with currency risk) I took their word for it.

[d000hg]

Indeed. I am not looking to squeeze every penny or tie myself up - just avoid missing out on an easy thing.

[Ketto]

I use Tide, 4.33% instant access. Very easy to set up.

There is a 20p per transaction fee but i’m typically only incurring that once a month when i transfer a chunk of any incoming invoices in.

Had an issue with incoming payments once as i must have triggered some fraud check or other, had to provide some documents and answer questions to prove the business was legit. The savings account is also not integrated to FreeAgent so you have to add manual transactions to keep your balances up to date.

But has been very easy to use other than that and getting a nice interest payment a month now.

[jamesbrown]

If you don't mind tying the money up for a year, you'll do a lot better than easy access (e.g., V.M. one-year bond @ 5.15%, similar for Allica Bank, Shawbrook and others. There are also 6-month bonds at around ~5%). Tide is OK - the interface is a bit 1990s and they are a bit over-zealous on their KYC checks, TBH.

[pr1]

It has rather caught me off-guard that as interest rates rose, you can actually get non-trivial business savings rates now. I always have a HSBC BMM account which pays a pittance (.1%) so I stopped using it, but looking around I see rates from 2% to in excess of 4%.

With very few, predictable expenditures, I can potentially keep the bulk of company money in a savings account and make a few grand a year. I'm kicking myself to have been remiss in this tbh.

Rules on interest being somewhat varied - some allow instant access but will reduce interest if you use this facility - I'd like to hear any recommendations and advice. Tide looks somewhat the obvious winner, but too good to be true?

Both my contractor Ltd and my wife & my other business accounts are with HSBC and have been sitting with 6-figure balances somewhat stably. I guess there's no reason a savings account should be with the same bank though it's slightly more convenient. HSBC only seem to offer about 2% by their "Kinetic savings" option and not needing another login doesn't seem to justify £1000+ per year

You have multiple six-figure balances all with the same bank? You know FSCS only covers £85k per institution? Interest rates aside I think you should be spreading your money out a bit more just in case - even if it's just to avoid being completely locked out of your money in the case of a temporary HSBC outage etc

[d000hg]

You have multiple six-figure balances all with the same bank? You know FSCS only covers £85k per institution? Interest rates aside I think you should be spreading your money out a bit more just in case - even if it's just to avoid being completely locked out of your money in the case of a temporary HSBC outage etc

Well they are two separate businesses and temporarily not being able to access a business account isn't a big problem. But given that 85k is pennies in the business world, how do businesses cover this? I imagine many even here have many times that and don't have accounts with 5-10 banks, and banks like HSBC are really geared to 500k+. Do companies take out insurance for this or do banks offer extra protection on large accounts?

Somewhat OT but I'm interested.

[alphadog]

I hadn't seen that one, or had misread the details. Thanks. So if you withdraw do you simply lose interest for that month or is it more punitive?

You can’t withdraw any of the deposit before it matures if you’ve invested £50,000 or more