Mixed news for Virgin Money customers to start the month.
Back in February Virgin Money shot to the top of the savings best-buy charts with a 1% rate – only for Chase Bank and then others to shoot past it a few months later. Now though it’s back at the top for new and existing customers.
However, it’s no use earning interest if you can’t access your cash – and at the time of writing the Virgin Money app and online banking has been offline for most of the day.
Here’s what you need to know about both the new rate and the problems with the app.
Virgin Money savings rate reaches 1.56%
As of 1 June 2022, the linked M Saver account that comes with all Virgin Money current accounts is paying 1.56% AER (variable). This is only on the first £25,000 held in the account. Any savings above this amount will earn 0.75%.
The rate will apply to existing accounts as well as new ones.
Though this isn’t yet showing on the Virgin Money website (and no one can log into the app to see their accounts either), I have had this confirmed by the Virgin Money press office, and it’s listed on the Clydesdale Bank website.
Prior to this change, the bank was offering 1% interest in the M Saver, so that’s a hefty jump. The increase is probably down to recent hikes in the Bank of England base rate and competition elsewhere which has seen dozens of accounts offering higher rates.
That’s in addition to the 2.02% you receive on the first £1,000 saved in the M Plus current account itself. Here’s my review of the current account.
How does it compare?
This just squeaks past Chase Bank’s 1.5% rate, although there’s a much higher £250,000 limit on balances that earn interest there.
It’ll be interesting to see if Chase or any other savings provider reacts in the next few days and pushes their offering to match or beat this.
We could also see another base rate increase in the middle of June, which would give more leeway to banks to pass some of it on.
But for now, this is the highest paying easy-access account, albeit on balances of up to £25,000. And you still can’t beat the 2.02% offered in the M Plus current account. So it’s a good combination.
Should you move your savings?
If you already have the Virgin Money account and have a decent amount of cash saved it makes sense to transfer up to £25,000 of your cash across to get the better rate. It should only take a few clicks so it’s relatively painless.
However, the increase is pretty small in the scheme of things. The difference of 0.06% versus Chase is worth just 6p for every £100 saved over 12 months. This table breaks down the difference.
|Savings moved||Extra interest over 12 months|
Of course, if you don’t have Chase Bank, the additional interest will be larger. If you’re earning 1%, then the extra 0.56% with Virgin Money would get you the following in a year:
|Savings moved||Extra interest over 12 months|
With either option, it’s worth remembering that we’ll likely see more movement in the coming weeks and months (hopefully upwards), so you might want to move cash again.
Virgin Money app and online banking crash
* Since this is a live news story I’ll update this section when there’s more information *
UPDATE 12PM THURSDAY 2 JUNE – The Virgin Money press office came back to me with answers to some questions I sent. Since the app is now back up and running some aren’t as pressing as they were yesterday.
Q Will there be any compensation for losses incurred as a result?
A “We’re sorry for the inconvenience this caused customers and, in line with our usual process, we review cases on an individual basis.”
Q Are standing orders/direct debits still paid in and out?
A “Yes – there have been no issues with standing orders or direct debits.”
Q Are debit card transactions working?
A “Yes – there have been no issues with debit card transactions.”
Q Can customers pay online without SCA (Strong Customer Authentication) approval via the app?
A “Some customers would have been unable to use SCA in app yesterday and would have received an error message from the online retailer. This was resolved as soon as normal service resumed.”
UPDATE 7PM WEDNESDAY – It looks like access is being restored and I can log in
Customers are starting to be able to access our mobile app and internet banking. If you do get an error message, please try again.— Virgin Money (@VirginMoney) June 1, 2022
We’re continuing to work away in the background to fully restore the service. https://t.co/ODhVTAf9rc
* Original story from Wednesday afternoon below *
Virgin Money has had a bit of a nightmare today with the app and online banking not working for customers since at least 8am (the earliest I can find a complaint on Twitter).
I noticed it when I tried to log in at 9am, and I’ve tried throughout the day to get access. As of 6pm, it’s still down for me and many more (despite the Virgin Money status update page declaring everything is “good”).
I’ve seen reports on Twitter of some users getting access, then losing it again. Virgin Money’s Twitter feed was silent on the matter until lunchtime, with another update mid-afternoon
A quick update on this issue – we’re still investigating, and our mobile banking app and internet banking service are currently unavailable.— Virgin Money (@VirginMoney) June 1, 2022
We apologise again for the inconvenience this is causing, and will get everything back up and running as soon as we can. https://t.co/06ixUeycOu
It’s not clear what has caused the error, or whether it’s connected to a Faster Payment issue seen at Santander and some other banks today.
What it means for your money
Again, it’s still unclear. You certainly won’t have been able to transfer money from the M Saver to the current account, or out of Virgin Money to external accounts. Seeing as the high paying interest rate puts this account as one of the top places for your savings, it’s likely a lot of people would be unable to access their cash.
Recent rules requiring most online payments to be authorised in the app will mean spending will have been an issue, though it’s possible in person use of the debit card will work.
I’ve seen reports of some Direct Debits and standing orders going through as usual, so hopefully that’s the case.
Finally, if your employer uses Virgin Money’s business bank and you’re due to be paid, it’s possible your wages could be delayed until the issue is fixed.
Will compensation be on offer?
Right now there’s no information as to whether you’ll be able to get compensated for any missed payments as a result of the downtime. As soon as I can get any details I’ll share them here.
I’d hope that if you’re out of pocket because you couldn’t get online there will be something in place to reflect this – but there’s no guarantee.
Why you need more than one current account
This downtime is a timely reminder that having all your money in a single account can be risky. Personally I’d always suggest at least two current accounts, ideally one which has a branch near you.
Then make sure your money is spread between them so you’ve at least got access to some cash if you can’t access one account.
Of course you can also open additional savings accounts, but you’ll still need a working current account to transfer the money to in order to use it.
Here’s more about this and other reasons to have multiple current accounts.