Woolworths went into administration late last year and closed the last of its stores in January. The Woolworths brand as well as its childrenswear, Ladybird were today bought by Shop Direct, UK’s biggest internet and home shopping retailer and owner of Littlewoods catalogue. It plans to launch Woolworths online from the summer.
Savers with cash frozen in accounts with the UK branch of Icesave will get back their savings through a fast-track refund scheme. Payments are expected to begin in the first two weeks of November. Although the plan has yet to be finalised, it is expected that payments will be made electronically into other accounts. This will happen in stages and the Financial Services Compensation Scheme (FSCS) will write to all ‘retail depositors’ to explain how the process will work.
The Saving Gateway scheme could hand you £600 for free over two years as long as an equal amount can be put forward over that period. The aim of the scheme is to encourage those on low incomes to save by possibly matching their contributions. It will not be launched until 2010 and the consultation stage will carry on until June this year. The Government suggests encouraging saving by offering either 20p, 50p or £1 for every £1 saved. The two pilot studies in 2002 and 2005 used these varying amounts but the Government has yet to decide on how much it will offer and is open to suggestions from members of the public at Saving Gateway Consultation, Room G67, HM Revenue and Customs, 100 Parliament Street, London SW1A 2BQ or julie.duffy@hmrc.gsi.gov.uk. Evidence from the pilots however, showed that the ‘match rate’ did not need to be as high as £1 per £1 to encourage people to save. Eligibility has been reined back to very low income levels but consideration is still made on an individual basis, so several people in the same household can sign up to the scheme.
The Bank of England’s Monetary Policy Committee (MPC) decided to keep interest rates on hold today at 5.25%. A decision which is in line with market expectation and predictions. It made no statement to accompany its decision but policymakers had been suggesting the bank had to balance the demands of slowing growth and rising inflation. Soaring oil prices and the rising cost of food is putting a huge pressure on inflation around the world. The policymakers are concerned that inflation could rise to around 3% in the coming months which will require the central bank Governor, Mervyn King to write an explanatory letter to the government. However, economists are predicting further interest rate cuts in the coming months.
Lenders have completely pulled out of the 125% mortgage market as the credit crunch continues to bite. Birmingham Midshires Solutions said it was pulling its version of the product, which will lend people up to 125% of their property’s value, due to market conditions. The group had been the only provider to continue offering the deals after Alliance & Leicester, Abbey, Northern Rock, Coventry Building Society and Godiva Mortgages all said they were scrapping them earlier this week. Faced with only limited availability of funds, lenders are keen to concentrate on less risky mortgages, and the problem has been compounded by fears that house prices could fall. There are now just two mortgage providers who will advance more than 100% of a property’s value, with Scottish Widows offering loans of 110% to professionals only, while Dunfermline Building Society is offering 110% to professionals and 105% to graduates but only in Scotland.
New banks from foreign shores are tempting savers with top rates of interest on internet accounts. Kaupthing Edge is owned by Icelandic Bank Kaupthing and its UK subsidiary Kaupthing Singer & Friedlander. ICICI Bank UK, a subsidiary of the huge Indian ICICI Bank, operates in 18 countries and has 24m customers worldwide. FBN (UK) Ltd, whose account, under the brand name FirstSave, is also in the best buy tables, is a subsidiary of First Bank of Nigeria. With all three banks the money in your savings account always stays in the UK and is invested mainly in cash and short-term bonds - or near cash - to finance the bank’s UK business. Your money will not end up in Nigeria, India or Iceland. Given the distinctly dodgy reputation of some Nigerian operations - it is the home of internet fraud and corruption is rife - this should provide reassurance to anyone considering FBN’s account. Savings in any of these three banks are covered by the UK’s Financial Services Compensation Scheme (FSCS). If any of these banks go bust then you can claim up to £35,000 per person per bank as they are all fully authorised by the FSA.
Landlords are being reminded to value their properties accurately for insurance purposes. Around 2.76 million properties are owned by landlords across the UK. They are currently valued at approximately £641 billion, up from £571 billion this time last year. It is recommended that portfolios should be reassessed every two years to avoid the risk of underinsurance. Meanwhile Halifax General Insurance is reminding all property owners of the scale of storm damage experienced across Britain last year. Over 1.5 million homes had their roofs damaged by high winds and the value of claims resulting from water entering properties from a hole in the roof totalled £2.5 billion. Storm damage appears to be on the increase in the UK and Martyn Foulds, senior claims manager at Halifax Home Insurance, warns: “homeowners without adequate buildings insurance cover risk finding a huge hole blown in their finances by the cost of repairs”.
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