Shopping around for the best savings rates can be tiresome. Comparison websites may only show deals that provide kickbacks, while some of the best rates are from more obscure providers you may never have heard of.
Rather than searching the websites of every bank and building society in the UK, startup Raisin* provides an innovative and simple solution. Raisin offers savers access to top savings rates through its own website, with just one sign-up needed. It saves you search time and the laborious registration forms as well as offering new customers a welcome bonus of £50.
Raisin brings years of experience in the savings market, having already operated and attracted more than 350,000 users across Europe, that lets savers access top rates from European banks. Raisin entered the UK market in March 2018 with the purchase of a similar offering called PBF Solutions, which was founded by Kevin Mountford. He brings a strong pedigree in the market, having been the head of banking at comparison website MoneySuperMarket.
As well as being popular among savers - with more than €34.5bn of deposits - Raisin has raised more than €206m across investors such as PayPal, Thrive Capital, Index Ventures, and Ribbit Capital.
How does Raisin work?
Traditionally, when you apply for a savings account, you need to complete several webpages to enter your personal details and account information. This can be frustrating and time-consuming if you want to open several accounts in different places. Raisin aims to remove the hassle and make the signing-up process more efficient.
Raisin's registration page is pretty slick, with just one webpage asking for your personal details such as your name, address, and national insurance number to verify your identity, as well as your income and a linked bank account. Users are signed up to the services of Starling Bank (via a Raisin UK Account) when they register in order to manage money transfers to savings accounts on the Raisin marketplace under a partnership between the brands.
This is the last time you have to have your ID confirmed as Raisin has automatically verified you on behalf of any of the partner banks it chooses. Raisin may ask for further documents to prove your identity if needed. Once registered, you can immediately start applying for a range of savings products from its partner banks through the Raisin marketplace online, using just one single login and password rather than having to remember multiple ones.
You have the option of applying for a range of products, including Fixed Term Bonds, Easy Access, and Notice accounts.
You can set how much you want to deposit and choose from different savings terms ranging from zero to five years. Each product displays information on deposit protection, how much you can earn, and how the provider is owned and regulated. Raisin does not offer joint accounts.
Raisin new customer £50 bonus offer - How does it work?
Savers can also earn a Raisin one-time welcome bonus of £50* if they deposit £10,000 or more. You must inform Raisin by sending an email from the email address associated with your Raisin UK Account to [email protected], with ‘Welcome bonus‘ in the subject line, within six months of funding your first savings account. The email should contain your full name.
Once your bonus has been verified, you will receive your money either within 14 days of verification if you have a fixed rate bond account, or within 14 days of your easy access or notice account having been open for 6 months.
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Referring a friend who funds a savings account with £25,000 or more will earn you an additional £25, while each of your friends will receive £25 when they fund a savings account with a minimum duration of 6 months with £25,000 or more.
What products does Raisin UK offer?
Savers can access products on the Raisin marketplace solely from its partner banks. It doesn’t just focus on the big UK brand names, but promises to provide secure savings products regardless of where the bank was founded.
It currently has partnerships with 19 banks in the UK market, with more on the way. There are products from providers such as Aldermore, Charter Savings Bank, Paragon Bank, Gatehouse Bank, and QIB (the UK wing of the Qatar Islamic Bank).
You can also access products from Maltese firm AgriBank, but unlike the others which offer Financial Services Compensation Scheme (FSCS) protection of up to £85,000, its savers are covered by the Maltese Depositor Compensation Scheme for up to €100,000.
The rates on offer are designed exclusively for Raisin users and both the Gatehouse Bank and QIB (UK) products are Sharia-compliant for those worried about the ethical standards of their savings provider. You can also sign up for alerts to inform you when new rates are available.
Does Raisin offer the best savings rates in UK?
Raisin is pretty careful with its wording when it comes to the rates you can get on its marketplace. It describes them as competitive, but they are not necessarily the best. The highest rate on offer on the Raisin marketplace is currently 1.80% from İşbank, although you will need to lock your cash up for five years.
If you don’t want to lock your money up for so long, Raisin is currently offering an exclusive rate of 0.27% on its easy access account via Investec. Raisin also offers a rate of 1.30% through İşbank for a 1 year fixed term deposit, and its best rate on offer for a 2 year fixed term deposit is 1.70%, also from İşbank.
If you're looking to assess Raisin's rates, they have a handy calculator on their website. All these rates may change regularly however, on both Raisin and elsewhere, so it is still worth keeping an eye on comparison websites rather than just relying on one source.
Pros and Cons of Raisin
Rates are one of the biggest factors when choosing a savings account, but you also can’t put a price on convenience.
Raisin lets you access multiple accounts in one place, you only have to remember one login and sign-in once, and there is also the option of Sharia-compliant savings. Additionally, it will alert you if any savings rates improve from its partners, so you should never miss out on a decent deal. This may in some cases make it worth considering even if the rates are a few percentage points off of the best buys.
Raisin also provides access to providers beyond the UK shores, which technically should help widen your scope for higher rates by considering banks on the continent. However, most UK banks already tend to offer higher rates, plus you need to ensure you are familiar with different deposit levels and tax rules when using an overseas bank.
You are also limited by the partners that Raisin signs up and the unique deals they offer, which may be competitive, but you still need to shop around to ensure they are actually the best.
Another downside is the fact that all of its products are still tax-liable, although Raisin states that less than 5% of UK savers will actually end up paying interest on the savings they earn. Basic rate taxpayers can earn up to £1,000 per year tax-free, but for higher rate (40%) taxpayers, it’s only £500.
Is Raisin safe?
Raisin is directly regulated by the Financial Conduct Authority. This means it has to follow rules on separating and protecting client money, so it isn’t mixed with its own funds.
All of the partner banks featured on the Raisin marketplace are either UK-based with deposits covered by the FSCS up to £85,000, or they are registered in a European country, where you will be covered under the European Deposit Guarantee Scheme (DGS) for the equivalent of €100,000.
These protections only apply per provider, so Raisin will also inform users if their funds are going into deposits with brands that are part of the same banking group as anything above £85,000 would not have as much protection, as technically it would fall under just one regulatory licence.
How does Raisin make money?
Raisin doesn’t charge any fees for its service. It makes money by introducing depositors to its partner banks. The amount it receives from the partner banks depends on how much you deposit and the duration of your savings product.
Cash management services are still a relatively new phenomenon.
DIY investing giant Hargreaves Lansdown entered the market in September 2018, currently offering rates of up to 1.35% through its Active Savings product and without any service fees for users.
Hargreaves Lansdown has a broader range of providers than the 19 partners that Raisin has. It has accounts from Investec, Paragon Bank, Coventry Building Society and Kent Reliance, as well as Shawbrook Bank and ICICI Bank. Similarly to Raisin, everything can be set up in one place and Hargreaves Lansdown will let you set up savings alerts.
If you want higher rates than traditional savings, there are also apps such as Moneybox, which rounds up the spare change from your spending and puts it into an investment portfolio that can be held in an ISA.
Raisin* makes the process of saving more convenient with a single login to access multiple accounts and offers new customers a bonus of £50 if they deposit £10,000 or more. Managing multiple accounts from one place is helpful in the fast-paced world we live in and will benefit those looking for an efficient way to get more from their money and to access some of the best savings rates in the market. But you are restricted to the partners Raisin chooses, and there are no tax-free saving options, so this is the trade-off for the convenience Raisin offers.
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