# KBC hike Regular Saver rate to 4.50% - Current Account Required



## Lightning (12 Apr 2014)

KBC are now paying 4.5% for regular saver accounts, if you open a current account with them. This is the highest regular saver rate for some time. 

Conditions:
1. KBC current account must be opened. 
2. KBC current account will incur fees of 24 EUR+ per year. 
3. Account must be opened before 30 June 2014. 
4. The 'bonus' of 1% on top of the normal regular saver rate, ends on 1 June 2015. 

KBC now offer their current account customers only the highest term deposit rate, the highest instant access rate and the highest regular saver rate via 3 contingent offerings. 

You obviously need to have large deposits to justify paying the fees to get the higher rates. Worth it for some.


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## rob oyle (12 Apr 2014)

Are there any circumstances where it would be worthwhile having a current account just to avail of this offer? From my calculations you'd earn an extra €60 before tax/DIRT/PRSI so it would be a couple of euro either way...


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## DMcL1971 (12 Apr 2014)

Hi Ciaran,

 I already have a KBC current account and an existing KBC regular saver account. Do you know if this new rate will apply to the existing regular saver account or is it only for a newly opened regular saver account.

 Do you have a link to the T&C's for the new regular saver account?


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## MrEarl (12 Apr 2014)

Hello,

I thought there was something to prevent Banks coniditioning that you take one product, to avail of another - the Consumer Protection Code perhaps ?

How are KBC getting around this, if I am infact correct ?


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## MugsGame (12 Apr 2014)

More details under the Bonus Offer tab on their Current Account page:
[broken link removed]


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## Lightning (13 Apr 2014)

rob oyle said:


> Are there any circumstances where it would be worthwhile having a current account just to avail of this offer? From my calculations you'd earn an extra €60 before tax/DIRT/PRSI so it would be a couple of euro either way...



Hi Rob, 

Yes, there are circumstances where it is worthwhile. There are also circumstances where it is not worthwhile. 

The fees are 24 EUR per year if you do not use the debit card. So you simply have to beat 24 EUR per year in net interest ABOVE the next best offer on the market. 

Circumstances where this is worthwhile include: If you take this offer in conjunction with the other KBC offers that are linked to their current account. For example, KBC offer 2.50% on a 1 year 3 months term deposit for current account customers. The interest that you will get from this and the regular saver account, depending on the balance, are likely to exceed 24 EUR in extra interest per year over the next best offer on the market. 

It is less clear if it is worthwhile, if you do not have an existing KBC Regular Raver account and if you do not want to open the other accounts linked KBC current account that also earn extra interest. In these circumstances, you may be better off with a free PTSB current account and a 4.00% Nationwide UK regular saver account.

Do your maths!


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## Lightning (13 Apr 2014)

DMcL1971 said:


> Hi Ciaran,
> 
> I already have a KBC current account and an existing KBC regular saver account. Do you know if this new rate will apply to the existing regular saver account or is it only for a newly opened regular saver account.



There is nothing in the T&C's that restricts this to new customers. 

Your standing order needs to come from your KBC current account. 

I would suggest that you check to make sure KBC are applying the 'bonus' interest.


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## Lightning (13 Apr 2014)

MrEarl said:


> Hello,
> 
> I thought there was something to prevent Banks coniditioning that you take one product, to avail of another - the Consumer Protection Code perhaps ?
> 
> How are KBC getting around this, if I am infact correct ?



Good question. 

Have a read of section 3.17 to 3.23 of the CPC on the CBI website [broken link removed].


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## MugsGame (13 Apr 2014)

I think the CPC is intended to prevent situations such as "you must open a current a/c in order to take out any loan with us" and not "you must open a current a/c to take out a loan with these specific conditions". As KBC provide regular and other savings a/cs which do not require a current a/c to be opened, they are compliant with the regulations. They are not the first bank to offer products or bonuses exclusive to current a/c holders.


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## Lightning (13 Apr 2014)

MugsGame said:


> I think the CPC is intended to prevent situations such as "you must open a current a/c in order to take out any loan with us"



Interesting. If this is the case, the CPC lacks clarity that this is its intended purpose. 



MugsGame said:


> and not "you must open a current a/c to take out a loan with these specific conditions".



Like the Danske offering!? How were Danske compliant?



MugsGame said:


> As KBC provide regular and other savings a/cs which do not require a current a/c to be opened, they are compliant with the regulations.



So, it is okay to have some contingent products if you also offer non contingent products?


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## DrMoriarty (13 Apr 2014)

I think it perhaps hinges more on the compulsion to "purchase" additional products (like a fee-charging current account). 


> A regulated entity must not make the sale of a product or service contingent on the consumer *purchasing another product or service* from the regulated entity.  This provision does not prevent a regulated entity from offering additional products or services to consumers who are existing customers which are not available to potential consumers.


So Danske were within their rights to require that mortgage customers hold current accounts with them for the life of the loan, _as long as they could do so without incurring fees_. Once they withdrew their Freebank product, that requirement fell foul of the CPC.


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## serotoninsid (13 Apr 2014)

Seems like a half-baked offering from KBC. If they were serious, they'd drop the current account fees.  They don't even have the overhead of a branch network!


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## Lightning (13 Apr 2014)

Some plausible interesting theories about the CPC criteria for contingent products. The letter of the law, in the CPC, seems to outlaw contingent products. However, everyone seems to think there is an implicit spirit or intent of the law, however, that is far from clear in the CPC rules. 



> Seems like a half-baked offering from KBC. If they were serious, they'd drop the current account fees. They don't even have the overhead of a branch network!



KBC have 10 or so cashless branches, they do not have the overheads of the traditional cash branches but they do have retail overheads. 

Agreed that if KBC were serious about an aggressive market share grab of the current account market they would offer a free account. PTSB are scooping up the lions share of current account switchers.


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## DMcL1971 (13 Apr 2014)

If you look at the types of accounts that KBC are currently offering, it seems to me that their primary concern is to attract deposits. Most of their accounts require a minimum balance of 3,000. They are offering the best interest rates on deposits. They are offering even higher interest rates to their current account customers. However the fees on the current account make it not worthwhile to open a current account unless you plan on saving a lot of money with them.

I think that KBC are purposely not offering a free current account because they want to attract customers with more money. I think that they are concerned that free banking will attract people who have very little money. It will cost KBC the overhead of maintaining these low balance current accounts without the benefit of the customers having any money on deposit with them.

 At the moment the only reason to choose KBC over PTSB as a current account provider is if you have more than about 10K that you wish to put on deposit with them.


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## Lightning (13 Apr 2014)

Interesting theory that KBC are perusing quality of customers over quantity of customers. The fact that they heavily advertise in up-market publications would corroborate this theory.  

The risk they run is reaching break-even, with economies of scale, in the complex world of current account banking, often requires a mass market proposition.


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## DMcL1971 (14 Apr 2014)

This offer of 1% bonus interest on Regular Saver Accounts is only available on newly opened Regular Saver Accounts, not on existing Regular Saver Accounts.

 On the web page it states:
 To avail of the optional extra bonus rate, you must set up a monthly standing order from your KBC Current Account to a *new* KBC Regular Saver Account by 30th June 2014.

 I rang them this morning and they confirmed that the bonus was only available to customers who have a KBC Current Account and are opening a new Regular Saver Account.

 Customers with an existing Regular Saver Account could close that account and open a new Regular Saver Account to avail of the 4.5% but that would be pointless as the old account would stop receiving 3.5% and instead revert to 1.25%.


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## MugsGame (14 Apr 2014)

Had same confirmed to me this evening, for an account opened this month but with a lodgement made before bonus deal was announced. My time is more valuable than the extra net interest I'd earn after closing the existing account and opening a new one.


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## MrEarl (15 Apr 2014)

CiaranT said:


> Some plausible interesting theories about the CPC criteria for contingent products. The letter of the law, in the CPC, seems to outlaw contingent products. However, everyone seems to think there is an implicit spirit or intent of the law, however, that is far from clear in the CPC rules.....



It might be interesting to ask them directly


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