Should you bank with the Vampire Squid?

IS IT WORTH IT? GOLDMAN SACHS’ 1.5% SAVINGS ACCOUNT

GIVEN its relentless pursuit of profit, investment bank Goldman Sachs may be an acquired taste. But many savers will now love it for launching an instant-access savings account that knocks spots off anything comparable from major high street banks. Hurrahs all round.

Branded Marcus, the online savings account will pay interest of 1.5 per cent on balances from as little as £1. To put this rate into perspective, it is more than seven times that available from NatWest (Instant Saver) and Lloyds Bank (Easy Saver).

Although some commentators have not been able to resist reeling out the nickname – Vampire Squid – that Goldmans acquired for its hard- nosed business approach in the run-up to the 2008 financial crisis, it is hard to be too critical about Marcus. ‘The account is going to make a splash,’ predicted one analyst, playing on the squid analogy. ‘Squid’s in,’ was another line used.

Not everyone will be compelled to get into bed with Marcus. It is an online account which will not appeal to those who still like to walk into a high street branch and see the whites of the eyes of the person behind the counter. Also, the 1.5 per cent is a variable rate so Marcus will have the right to shave it at any time, irrespective of what happens to Bank base rate. Most likely is that any future base rate rise will not result in a tickling up of the savings rate.

The only guarantee in place is a one-year 0.15 per cent bonus. In theory, this means Marcus could cut the rate to 0.15 per cent. Of course, it will not. The Vampire Squid era is firmly in the past. Surely.

VERDICT: This is a market-leading product. Let’s hope its arrival prompts other providers to raise their meagre savings rates.