New savings account is launching and customers could win £10,000

Martin Lewis advises on savings accounts and premium bonds

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Savers only need £1 to open one of these easy access accounts from saving and investing app Chip. Anyone can win the monthly £10,000 cash prize just for having £100 in their account but there is a catch.

Chip will run a monthly prize draw and, provided users have at least £100 in their account, they will get entries by simply holding money in the account at the end of the month.

The minimum deposit into the account is £1 and the maximum amount is £85,000, with every £10 deposited counting as one entry per month.

The more you deposit the more entries you have, up to a maximum of 8,500 entries per customer.

Users can also withdraw anytime with funds arriving in seconds but the account comes with a catch which could be a dealbreaker for some – the Prize Savings account doesn’t offer an interest rate on savings.

Chip’s CEO and founder, Simon Rabin, compared the savings account to Premium Bonds which are loved by millions of Britons.

“NS&I’s Premium Bonds are the UK’s biggest savings product, 21 million of us have £118 billion in them. NS&I Premium Bonds are a savings account you can put money into (and take out when you want), where the interest paid is decided by a monthly prize draw.

“However, withdrawals sometimes take up to six days, and in December 2021 NS&I received 4,187 customer complaints that month.

“What’s more, in late 2021 there was a whopping £74,452,325 in unclaimed prizes.”

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“We think when it comes to customer experience, there’s a lot of room for improvement – we think our new ‘Prize Savings Account’ is just what you need.

“We pride ourselves on offering products built with users in mind with simple and clean UX, and award-winning customer support.

“We know that not everyone is comfortable with the risk of investing to get potential higher returns.

So we wanted to offer something for these people that was more exciting than a conventional savings account.”

The new account also works with Chip’s Savings Plans, meaning users can build bespoke savings plans tailored to their needs and preferences.

The Premium Bonds September winners have been announced – but what are the chances of winning?

The chances of one bond winning a prize in a month is one in 24,500 and the nearest thing Premium Bonds have to an interest rate is their annual prize rate, which is currently 1.4 percent.

The best regular savings accounts are currently offering up to five percent interest, although there are limits on how much people can put away every month.

The Yorkshire Building Society offers five percent interest but savers can only put away £500 a month.

Meanwhile, money saving expert Martin Lewis advises people to weigh up the options when it comes to savings accounts that offer the chance of winning cash prizes instead of interest.

While they can be enticing, there is no guarantee customers will win a prize at all.

“If you won’t earn over the personal savings allowance, and have average luck, Premium Bonds are unlikely to beat top savings accounts.”

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