The Bank of England base rate is currently 0.1%, which has had a crippling effect on the country’s savings accounts. With interest rates at an all-time low in the UK, savings account holders are understandably worried about the value of their savings.
However, a new high interest savings account just hit the market! Bank Challenger Tally has launched the UK’s first gold-backed savings account that promises market-leading interest rates. Here’s what you need to know about this first type of account.
What is Tally?
Tally has launched a gold-backed savings account that offers market-leading returns and better protection for UK savers. The new Competitive Savings Account offers a one-year 2% fixed-rate return, the highest offered by any savings provider.
Tally is accepting deposits of up to £ 20,000. The company operates in a reserve banking environment, which means that the funds will never be lent, leveraged or invested. Most competing savings providers take out loans using customers’ savings to make a profit. As a result, depositing in one of these accounts may put your funds at risk.
Tally is a gold-backed savings account. This means that the funds are anchored in gold, which usually increases the price along with inflation. The funds in a Tally Savings Account represent the actual ownership of the gold. Therefore, the value of the account is not affected by inflation.
How does a new savings account work?
According to CEO Cameron Parry, the Tally account “provides security and transparency for savers while introducing them to a better financial system”.
Tally’s developers have achieved this by offering a savings account that moves away from the Fiat currency. Instead, when you deposit money into your Tally Savings account, you get real ownership of the gold. Each unit of Tally represents one milligram of physical gold.
The account has a fixed interest rate of 2% and savers are able to deposit anything up to £ 20,000.
Do I need to open a Tally account?
Tally accounts provide higher interest rates and more security for account holders.
Cameron Parry, explains: “The current banking system reduces any savings advantage, while our new accounts provide security and transparency for savers while introducing them to a better financial system.”
Compared to market competitors, Tally offers the best 1-year returns on deposits up to the highest interest rates and value up to £ 20,000. However, those looking to make larger deposits may have to look for an alternative savings option.
Tally’s maximum deposit is only £ 20,000 whereas competitor Zopa offers a £ 250,000 maximum deposit. In addition, Tally’s minimum deposit is £ 1,000 This means that savers with less funds will not be able to open an account.
However, opening a Tally account can be a great way to protect your savings from inflation. Gold is a commodity that increases in price along with inflation. Therefore, saving with a Gold-backed Savings Account can prevent your savings from losing their value over time.
How do you open a Tally Gold-backed Savings Account?
To open a Tally Savings Account, you must be a member of Tally. You can easily join by completing the onboarding process and paying a one-time joining fee of £ 20. Each year, account holders must pay a 1% account-keeping fee.
Once you become a member, you can open a savings account through the Tally app. To do this, you need to deposit a minimum of £ 1,000. You can transfer funds from your Tally Savings account to your current account at any time.
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