Is this 24/7 bank worth saving with?
Since its launch in 1989, first direct has branded itself as the bank of the future.
It was a novice idea. Why not give customers all their banking needs over the phone, and why not provide 24/7 customer service every day of the year?
Read on for an overview of the savings accounts on offer from first direct.
Starling Bank: award-winning banking on your mobile
Who owns first direct?
first direct is owned by HSBC. So, while you can’t find first direct on the high street, it does offer cash and cheque paying-in services through HSBC’s branches.
first direct is a separate division to HSBC but the two do offer similar savings account rates and deals. However, the two differ in other aspects. first direct often tops polls for the quality of its customer service.
How to pay a cheque or cash into first direct
If you’re wondering how to cash a cheque in with first direct, it’s incredibly simple. Just use the online HSBC store locator to find your local branch.
You can pay in cash or cheque. In addition, you can take cash out over the counter at an HSBC branch. However, you need to call first direct in advance to arrange this particular service.
If you have a 1st account then you do all these actions at a Post Office branch. However, paying in a cheque is slightly more complicated. Here are the details:
- You need a pre-printed first direct credit slip, from your paying-in book.
- You’ll also require an HSBC Post Office® cheque deposit envelope, which you’ll find on the Post Office® counter.
- Cheques paid into the Post Office® will take a day longer to reach your account than cheques paid in at HSBC branches.
- first direct sometimes also offers a cheque cashing service at Post Office® branches, to customers who can’t use a chip and PIN card – subject to status.
What savings accounts does first direct offer?
- Regular savings
- Cash ISA
- Fixed rate savings
- Bonus savings
- Everyday savings
- The best rate it offers
- Pay in between £25 and £300 each month for a fixed 12-month term
- Can’t make withdrawals. If you do, you’ll only get the standard savings account rate – this is much lower and variable
- No joint account option
- The second best potential interest rate first direct offers for savings accounts
- Earn 0.85% AER (variable) interest. Tax-free
- You can put in up to £20,000 this tax year (2018-2019)
- Variable interest calculated daily and applied monthly
- Transfer to first direct from another provider
- Apply online or by post
- Manage your account online, in the mobile app, by post or phone
Fixed rate savings
- Third best interest rate
- Lock a fixed lump sum away for a set term of one year at a fixed rate (no monthly payments)
- Plus side? You know exactly how much you’ll earn and the interest rates are decent
- Downside? No partial withdrawals allowed whatsoever, and no putting extra money in
- This option isn’t for anyone on a budget – £2,000 to £1 million is the deposit range
- If you do withdraw you’ll be charged £100 and could get back less than you put in
- Potentially the fourth best for interest, although not if you frequently withdraw money
- The account rewards you for not dipping into your savings
- Every month you don’t make a withdrawal you get a bonus rate of interest of 0.60% AER gross variable, on balances of up to £100,000
- You can withdraw money from this account but as soon as you do, your interest rate drops to 0.10% AER/gross
- Bonus rate applies for every month you don’t make a withdrawal
- You can start saving from as little as £1
- Deposit and withdraw whenever you want, although you’ll need a first direct current account
- Save from as little as £1 with no maximum limits
- Manage by phone, online or post
- You can get either sole or joint savings accounts
- Lowest interest rate out of all savings accounts
How safe is first direct?
One thing to bear in mind is if you plan on having accounts with both HSBC and first direct. FSCS rules mean you’ll be covered for up to £85,000 if your bank goes insolvent. However, the rules apply to the overall banking group, rather than the individual bank.
So if HSBC and first direct both go bust, you would only be covered for £85,000 – not £170,000.
It is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.