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FOOL'S EYE VIEW
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Last week the Chancellor of the Exchequer opened a new type of savings account. How do I know this? Well, because he said so when he launched the new not-for-profit Charity Bank. In fact, he was their first customer. And, yes, you did read that correctly. It's a bank that doesn't make any profits. The Charity Bank is thought to be the first of its kind in the world and its aim is to provide cheap loans to charities who usually have difficulty borrowing from mainstream institutions or who can't afford the often high interest rates. It's a registered charity which is backed by the Government and regulated by the Financial Services Authority and, to all intents and purposes, operates in exactly the same way as an ordinary bank or building society savings account. The bonus for those who want to support good causes is that they get to keep their capital. Individuals can open a deposit account which attracts an interest rate of up to 2% and the money is used to lend to charities at a cheaper interest rate than they might normally find on the High Street. Unlike a donation, people can get their money back when they need to but while it's in the bank, it's being used to benefit the community. For savers the interest rate of 2% is hardly the most attractive around at the moment but it does at least allow you to keep pace with inflation. In fact, if you're feeling really generous, you can even waive the interest which has the effect of becoming a donation with all the tax benefits that that attracts. The key thing though is that you can get your capital back any time you like subject to a minimum 90-day notice period and depending on the type of account you open. It's a way of giving to charity without actually giving your money away. All the money deposited will be lent purely for charities and social enterprises throughout the UK to help build new facilities, renovate buildings, or purchase equipment. As well as loans, it also offers financial advice and support to help charities become more financially aware. There are four types of account available to the saver: Social Capital Account Community Reinvestment Account Building Assets Account Small Steps Account Personally, I rather like the sound of this new bank and I'm considering opening an account. Like many people I restrict my donations to a small number of charities because there are just too many to support and I often feel really guilty when I turn away people who knock at my door collecting for a charity that's not on my little list. At least this would be a way of supporting more charities without being completely out of pocket. As the bank points out, more than £500 billion is sitting in deposit and savings accounts in the UK, and most depositors have no idea where it is being invested. If just 0.2% of this was reinvested for the common good, it would mean £1 billion worth of social investment. It may be better to give than to receive but this sounds like a good way to do both.
This is a 90 / 180 / 365 days' notice savings account. You can also choose a longer notice period than 365 days if you want to.
This is simply a monthly savings account.
This is a fixed term deposit account ranging from 1 to 10 years duration. You choose the period that most suits you.
This is a fixed term deposit account for children under 16.