Ford Money closes 4% savings accounts to new applicants two days after launch
Ford Money launched its regular saver account and regular saver cash ISA products paying a head-turning 4% just two days ago.
Following huge demand, the regular saver account closed to new customers yesterday and the regular saver cash ISA closed today.
Due to the tremendous response from savers who are more used to seeing rates hovering around the 1% mark, Ford Money said it will potentially release similar products later in the year.
Short-lived top offering
Savers who managed to open one of the accounts will be able to stash away between £25 and £250 each month, meaning the most they can earn is £65.26 after 12 months (on the maximum £3,000). The amount that can be saved each month can vary so savers won’t be penalised if they don’t make deposits every month.
The 4% rate will be paid for the first 12 months but after this it will be moved to Ford Money’s flexible saver which currently pays 1% AER. The ISA will be moved to its flexible cash ISA, currently paying 0.9% AER.
Car manufacturer-come-new savings provider Ford Money operates a 14-day cooling off period on both products which means account holders can withdraw their money, or close their account, within that time without penalty.
However, after this time, those with the regular saver account won’t be able to withdraw their money or close their account within the first year. For those with the cash ISA product, withdrawals and transfers are allowed but you’ll lose 90 days’ interest on the amount taken out. But as the regular saver cash ISA is classed as a Flexible ISA, you’re allowed to withdraw and replace money in the same tax year without losing your tax-free entitlement.
Both products come under Ford Money’s ‘best rate guarantee’ which means if interest rates increase before you’ve made an initial deposit, the account will be automatically upgraded to the new rate. Savings also come under the Financial Services Compensation Scheme (FSCS) which means amounts of up to £85,000 are protected if anything were to go wrong.