Single Easy Access Rate (SEAR)

Couldn’t see a thread on this already, what do people think of this that could be happening?

Meant to help people who don’t bother to switch after the introductory rate, but the SEAR probably would mean the rate is set at like 0.5% so the firm isn’t losing anything from the change from the people who don’t bother switching after they start cutting the rate down.

Year 1 - 0.5% plus a bonus 0.7% = 1.2%
Year 2 onwards - 0.5%

From what I understand is that they wouldn’t be able to ever reduce that 0.5% if that’s what was chosen.

I can’t see what would stop them doing this either: :man_shrugging:

Year 1 - 0.1% plus a bonus 1.1% = 1.2%
Year 2 onwards - 0.1%

Would be interesting to know if this world effect marketplace providers like Monzo

1 Like

Based on history I can’t see it working out well. The banks aren’t going to willingly lose out.

Its a bit like the recent overdrafts where the FCA was like we need to make things simple so you can’t have fixed costs so all lenders were pretty much, “well if we all go to 40% then”.

If you get all the big players go “well our SEAR is 0.1%” that could start a trend in everyone picking a similar number. That still doesn’t help the people who don’t remember or bother to switch.

It might help the people who do switch anyway as the firms will all be fighting over the introductory rates. Could just mean a lot more yearly switching overall like if Marcus wasn’t dropping 1.5% to 1.35% which I imagine people may stick with, and instead was like 1.5% to 0.1% you’ll be moving your money asap.