- Tuesday 13 July 2021
INTRODUCTION
As a Financial Planning & Investment Management Firm, our role is to assist our clients in a wide range of areas, including those relating to business matters where appropriate. Following a number of conversations about the issue of corporate bank charges, we felt it would be useful to offer our perspective and advice to business owners.
PROBLEM
As you are no doubt aware at this point, banks have started applying negative interest rates to corporate/business accounts. This fee can be as high as 0.65% per annum, meaning that businesses could be paying hundreds or thousands of euro simply to hold funds on deposit.
While we understand that companies need to keep funds in the bank for cash-flow, in many instances there are businesses holding significant reserves that don’t require instant access. Therefore, leaving money to be charged is simply bad practice.
We know there is a hesitancy to move funds out of a business bank account for fear of introducing ‘risk’ to company funds, alongside a perception that there are no options that give as much security or liquidity. This is simply no longer the case.
SOLUTION
A large number of our providers, including Davy, Conexim, Zurich among others, are now offering dedicated corporate accounts in response to the move by the banks.
Some of these accounts are set up to simply generate 0% returns, which is still better than the bank rate, while others aim to achieve higher returns.
These dedicated accounts offer full liquidity and can have the same protections as a regular deposit.
NEXT STEPS
If you would like to explore alternatives to your present (negative) corporate banking rates, simply click here to schedule a meeting with our Investment Team at a time that suits.
