Latest news with #LHVBank
Finextra
4 days ago
- Business
- Finextra
LHV survey: Digital banks should pass savings from not operating physical branches to consumers
As the cost-of-living crisis continues, new research from LHV Bank reveals that 46% of UK adults are struggling to save regularly, despite reported income increases for nearly a third of the population. 0 This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community. The study, conducted by Opinium on behalf of LHV Bank, highlights growing frustration with both traditional and digital banks. With most consumers (two-thirds) agreeing that digital banks should pass on the savings from not operating physical branches, the pressure is rising on financial institutions to deliver better value and transparency. In fact, 41% of respondents would support government legislation to ban 0% interest current accounts altogether. One in five UK adults believe their bank offers fair value, and 53% say they would switch providers for better interest rates. Among younger consumers aged 18-34, that figure jumps to 65%. LHV Bank has launched the UK's first new current account in nearly five years, offering a 3.25% interest rate and zero fees, positioning itself as a challenger to traditional banking models. According to the LHV survey, the disconnect between income growth and financial wellbeing is stark. While 29% of respondents say they've earned more in 2024, 31% feel worse off financially. Women are especially affected, with 35% feeling financially worse off compared to 28% of men. This financial strain may be explained in part by a growing gender gap in saving habits. On average, men save £280 per month, which is £115 more than women (£165). Men are also more likely to earn interest on their current accounts and at higher rates. 47% of male account holders that earn interest receive more than 2.1% AER, compared to just 35% of women. Kris Brewster, director of Retail Banking, LHV Bank, says: "We launched our current account to raise the bar in banking – by rewarding customers with meaningful rates at a time they need it the most. We're paying a highly competitive 3.25% interest rate and are still able to grow responsibly and profitably – demonstrating that running a strong bank needn't come at the expense of rewarding customers. We choose to share value back with our customers. Most banks could do this - they just choose not to."
Finextra
27-05-2025
- Business
- Finextra
LHV Bank launches interest-bearing current account in UK
LHV Bank, a fully licensed UK bank, today launches its new fee free current account with market leading 3.25% AER on all balances up to £1 million, tracking the Bank of England Base Rate minus 1%. 0 Today's launch provides a new alternative for the UK public and takes aim at the £252bn of deposits* held in non-interest-bearing bank accounts in the UK. By contrast, LHV Bank customers' money is always at work, earning a market leading rate of interest from the moment it goes into their current account. New research from LHV Bank and Opinium - surveying 2,000 UK adults - reveals the scale of Britain's 0% interest current account challenge. Less than a third (30%) of Britons report collecting interest on their most used current account, whilst two in three (64%) believe banks should be responsible for warning them if their current account is not earning interest. Two fifths of respondents (41%) would support Government legislation to ban 0% interest rate current accounts altogether. ** LHV Bank aims to be the best place to save money and, alongside the new current account, offers a range of competitive fixed rate savings bonds with further savings products planned. It secured its full UK banking licence in 2023 and is now doubling down on its commitment to the UK market, where it sees significant opportunities for innovation and disruption. The launch of LHV Bank's current account offer is accompanied by an advertising campaign aimed at 'Reckless Savers'. The campaign goal is to encourage UK consumers to switch banks to earn interest on their current account balance, in turn pushing the banking industry to better by its customers and offer current account interest as standard. Reckless Savers can sign up today to LHV and make their money work harder for them. Erki Kilu, CEO of LHV Bank, said: 'The majority of UK banks are focused on helping customers to spend money, but at LHV we take a savings first approach. We believe that every penny deposited with your bank should earn interest, making it easy to be a 'reckless saver' and make the most of your money. LHV is a bank for savers, not for spenders.' Alongside leading interest rates, from today LHV customers can make use of: · A fresh, new banking experience: the LHV Bank app has been designed from scratch to offer customers a seamless self-service user experience · Advanced fraud prevention: cutting-edge real-time risk decisioning technology protects customers from fraud and scams · Fee free interest: access to fee free market leading interest rates on current account balances as standard · Debit Cards: stylish, minimalist Debit Cards in a range of colours to match any style with no current account or overseas debit card transaction fees · Google Pay: enabled from launch, with Apple Pay coming soon Kris Brewster, Director of Retail Banking at LHV Bank, said: 'Millions of people across the UK are being short-changed by banks offering 0% on their current accounts. At LHV, we're giving customers the tools to take control - combining meaningful interest rates, modern app-based technology, and complete transparency to help them make smarter money decisions every day.'
Finextra
21-05-2025
- Business
- Finextra
LHV Bank launches current account
LHV Bank, a fully licensed UK bank, today launches its new fee-free current account with market leading 3.25% AER on all balances up to £1 million, tracking the Bank of England Base Rate minus 1%. 0 This content is provided by an external author without editing by Finextra. It expresses the views and opinions of the author. Today's launch provides a new alternative for the UK public and takes aim at the £252bn of deposits* held in non-interest-bearing bank accounts in the UK. By contrast, LHV Bank customers' money is always at work, earning a market leading rate of interest from the moment it goes into their current account. New research from LHV Bank and Opinium – surveying 2,000 UK adults – reveals the scale of Britain's 0% interest current account challenge. Less than a third (30%) of Britons report collecting interest on their most used current account, whilst two in three (64%) believe banks should be responsible for warning them if their current account is not earning interest. Two fifths of respondents (41%) would support Government legislation to ban 0% interest rate current accounts altogether.** LHV Bank aims to be the best place to save money and, alongside the new current account, offers a range of competitive fixed rate savings bonds with further savings products planned. It secured its full UK banking licence in 2023 and is now doubling down on its commitment to the UK market, where it sees significant opportunities for innovation and disruption. The launch of LHV Bank's current account offer is accompanied by an advertising campaign aimed at 'Reckless Savers'. The campaign goal is to encourage UK consumers to switch banks to earn interest on their current account balance, in turn pushing the banking industry to better by its customers and offer current account interest as standard. Reckless Savers can sign up today to LHV and make their money work harder for them. Erki Kilu, CEO of LHV Bank, said: 'The majority of UK banks are focused on helping customers to spend money, but at LHV we take a savings first approach. We believe that every penny deposited with your bank should earn interest, making it easy to be a 'reckless saver' and make the most of your money. LHV is a bank for savers, not for spenders.' Alongside leading interest rates, from today LHV customers can make use of: A fresh, new banking experience: the LHV Bank app has been designed from scratch to offer customers a seamless self-service user experience Advanced fraud prevention: cutting-edge real-time risk decisioning technology protects customers from fraud and scams Fee free interest: access to fee free market leading interest rates on current account balances as standard Debit Cards: stylish, minimalist Debit Cards in a range of colours to match any style with no current account or overseas debit card transaction fees Google Pay: enabled from launch, with Apple Pay coming soon Kris Brewster, Director of Retail Banking at LHV Bank, said: 'Millions of people across the UK are being short-changed by banks offering 0% on their current accounts. At LHV, we're giving customers the tools to take control – combining meaningful interest rates, modern app-based technology, and complete transparency to help them make smarter money decisions every day.'
Daily Mail
20-05-2025
- Business
- Daily Mail
LHV launches first new current account in the UK for four years and offers 3.25% uncapped interest on balances
Britons will have another current account to choose from as LHV Bank, a fully licenced bank, has launched a new offering. It is the first new current account to launch in Britain since 2021 when Chase Bank burst onto the scene, and it already offers savings accounts and loans. LHV which has been operating in the UK since 2018, after establishing itself as the third largest bank in Estonia, received a banking licence in 2023 and has been developing its UK current account for a year and a half. Erki Kilu, chief executive of LHV, told This is Money at its London HQ it is a natural progression for LHV to offer current account, as it already offers loans and fixed-rate saving accounts. He said: 'For me real banking is making credit and making interest income. I can't imagine a bank without current accounts.' As an entirely app-based bank, it is taking on the likes digital banking giants Starling, Monzo and Chase by offering customers 3.25 per cent interest on any balances held in the current account. This rate tracks 1 per cent lower than the Bank of England base rate so it rises and falls with it. Starling scrapped its 3.25 per cent current account interest on balances up to £5,000 in February, as did Chase with its 1 per cent current account interest. The only other bank accounts which pay interest on current account balances at the moment are digital bank Kroo, which pays 3.15 per cent on balances up to £500,000 and also tracks 1 per cent lower than the base rate. Nationwide's FlexCurrent account pays 5 per cent interest on balances up to £1,500 for 12 months. After that the interest is 1 per cent on balances after that up to £1,500. With markets pricing in three more interest rate cuts by the end of this year, customers could find their current account interest slashed to 2.5 per cent, assuming the bank of England votes to cut the base rate by 0.25 percentage points each time. However, the Bank of England's chief economist has warned it has been cutting rates too quickly. That would still be better than earning no interest at all though. There is a chunky £1million cap on balances which can receive interest in the current account, which seems like an expensive business for LHV. But with the base rate at 4.25 per cent and commercial banks earning this rate on deposits held with the central bank, Kilu is not phased by this. He says: 'It's not loss-making for us if we have higher sums. We keep it in the central bank.' 'If the amounts kept in current accounts are £1million then we need to keep them very liquid and can't use them for lending.' As the Financial Services Compensation Scheme limit, which protects deposits if a firm fails, stands at £85,000 people don't tend keep sums bigger than this in accounts anyway. Funds held in LHV accounts are protected under FSCS. The average amount held in a current accounts paying no interest is £2,067, according to research from Paragon Bank. If this were held in the LVH current account it would earn £67 after a year at 3.25 per cent, albeit if the rate stays the same. Kilu didn't rule out the possibility of launching Isas in the future. But as it's next step LHV's will look to launch overdrafts and linked easy-access accounts, which will arrive within a few months. The current account is designed to be intuitive and self-service so new customers can open and use the account quickly. Customers will receive a debit card and can use google pay, with Apple pay expected to launch soon. Kilu said: 'If we develop anything then it should be easy to use for the customers so they don't need any handholding. But with said, should new customers require help with banking queries LHV has customer service help via email currently and there is a dedicated customer service team based in the UK. 'If customer numbers grow, then of course we need to keep an eye on customer support', says Kilu. But he is coy about the number of customers LHV anticipates it will attract in its first year. 'We are a bank for savers, not for spenders. If you want a good interest rate and to start saving with small amounts then LHV should be the first choice.'
Yahoo
18-04-2025
- Business
- Yahoo
Best cash-saving deals as inflation drops to 2.6%
UK households are always looking for ways to make their money go further amid the cost of living crisis, and savings accounts can help. After years of low rates, high-yield savings accounts are still having a moment even after the Bank of England (BoE) held interest rates at 4.5% in March. While homeowners face lofty mortgage rates, there is a silver lining in higher borrowing costs, and consumers can find UK savings accounts offering rates above inflation. However, UK savers could see rates drop after Donald Trump's global tariffs war. Myron Jobson, senior personal finance analyst at Interactive Investor, said: 'The market is now predicting that interest rates will fall more quickly than previously anticipated as policymakers move to shield the stuttering UK economy from a potential downturn — a risk exacerbated by Trump's tariff wars. 'While lower borrowing costs might come as a relief to mortgage holders, they could spell bad news for savers, who have only just started to see decent returns on their cash after years in the doldrums.' Experts urge savers to shop around for the best deals and review their accounts regularly, as many may still be sitting on products that fail to beat inflation. Ian Futcher, a financial planner at Quilter, urged savers to look around for the best deals. He said: "Lower interest rates, while beneficial to borrowers, tend to erode savings rates, particularly in easy-access accounts. Tariff-driven inflation could further weaken the real returns savers receive. "With that in mind, savers should be proactive — locking into fixed-term deals where higher rates still exist or considering a diversified investment strategy tailored to their time horizon and risk appetite." The UK inflation rate fell to 2.6% in the year to March, according to the Office for National Statistics (ONS). This means that prices have been rising at the slowest pace since December and are closer to the Bank of England's 2% target. Savers should shop around to find the best deals and check what rate they are on. Providers have already started to lower rates as interest rates fall, so consumers need to check if their money is well-placed for higher returns. Read more: Six FTSE 100 stock ideas for the second quarter, according to Barclays The main factor to consider when choosing a savings account is the difference between easy-access and fixed-term accounts. Easy-access accounts allow you to access your money when you need it. Fixed-term means you can't access your cash for the duration of the deal. They usually offer better rates, but you must be comfortable not touching your savings for an extended period, usually between one and five years. Cynergy Bank pays 4.65% for one year, with interest paid on maturity at the end of 12 months. You can open the account with £1,000 and invest up to £1m. LHV offers the same 4.65% for one year with the same key conditions. Erki Kilu, CEO of LHV Bank, said: 'LHV Bank is built for savers — a commitment that is reflected in the products and services we offer. At a time when market volatility is putting extra pressure on personal finances, our new one-year bond offers customers a fantastic option for growing their money and taking control of their financial future. "We believe that customers deserve better value savings rates than they are routinely being offered.' Close Brothers pays 4.61% for 12 months. The key condition is that you need at least £10,000 to open the account, with deposits capped at £2,000,000. Online banks typically offer higher rates than traditional bricks-and-mortar branches, which translate into better returns, giving you a more efficient way to save and reach financial goals. Digital-only banking use has grown for the second year in a row, according to research from personal finance comparison site Finder, with superior interest rates the biggest factor driving adoption. If you prefer to go with a familiar name, the high-street lenders have slightly lower offers, but are still above inflation. Read more: Sub-4% mortgages are back amid US tariffs turmoil Tesco (TSCO.L) Bank offers the highest rate among high-street lenders, with a one-year fixed-rate savings account that pays 4.35%, with the minimum balance required being £2,000. However, you can invest up to £5m. Nationwide (NBS.L) has a fixed-rate savings product offering 4.15% for one year. The minimum deposit is just £1 and interest will be paid on the anniversary of the date you opened your account (regardless of when the account was funded), at the end of the term, and on the day your account closes. Unlike easy-access products, where interest rates can vary, fixed-rate accounts earn a set rate of interest for the period you choose, whether that's six months or several years. Those are the most common deals, but some offers go up to 10 years and over. You must leave your initial deposit for a fixed period without making withdrawals. If you touch your money, you forfeit any interest. Easy-access savings accounts let you withdraw your money without notice. With that ease of access come lower interest rates, but they are a good option for those who think they might need their money in a hurry. Be aware that rates on these accounts are variable, which means they can go up or down. You will be notified of any change ahead of time. Read more: Best credit card deals of the week Sidekick has a 4.84% deal available that comes with unlimited next day withdrawals, meaning you can access your money whenever you need it, without restriction or loss of interest. The deal includes a 0.55% savings bonus and a 0.25% investor bonus — customers who have both savings and investments — for 12 months on balances up to £35,000. Monument pays 4.75% but you need at least £25,000 to open the account, with deposits limited to £2m. You are allowed a maximum of three withdrawals per year. Atom pays the same 4.76% but with no minimum to access. You can invest up to £100,000 and the rate will fall to 3% in months you withdraw. There are even higher-paying easy-access accounts, but they are not for new customers. Santander's (BNC.L) Edge Saver, for instance, offers 6%, but is only available to current account holders. Can't decide on whether you want to put your money away and not touch it for a long time or keep it accessible at all times? Maybe you should consider a notice savings account. Notice savings accounts require you to give notice to your savings provider before you can withdraw your funds. These are ideal for those who know when they might need their cash but don't want to face the temptation of dipping into it at any time. Read more: Average London rent soars to £2,243 per month You need to give the bank or building society a set advance warning before you can withdraw your money — usually between 30 and 120 days. OakNorth Bank via Prosper has a 95-day product that pays 5% in which 4.61% is paid daily into the account an 0.39% is a boost paid annually into the nominated account. You'll need at least £20,000 to open it and can deposit up to £250,000. Oxbury has a 120-day product that pays 4.85% for which you'll need £1000 to access. Santander via Prosper has a 185 day deal that pays 4.83% but you'll need at least £20,000 to access it. Interest rates with notice accounts are variable, which means they could go up or down over time. For those looking to make the most of their cash savings, regular savings accounts offer up to 8% returns. Most regular savings accounts require you to put money away each month with interest paid yearly. It is not uncommon for the offer to be available only to current customers. Principality offers 7.5% in a six-month regular saver account, after dropping its 8% deal. You open an account and pay in up to £200 each month. Interest is calculated on the money in the account each day and paid six months after opening. The Co-operative Bank has a 7% deal for existing customers. Fixed for one year, you can save up to £250 per month and can skip months without penalties. First Direct also has a deal that pays 7%. You can open this account with £25, which is the same amount required to go into it every month. The maximum per month is capped at £300. Every deal mentioned here is covered by the Financial Services Compensation Scheme, so you are protected up to £85,000 or double that if it's a joint in to access your portfolio
