Access Accounts
These
products generally give you immediate
access to your money upon request,
without penalties. These are also known
as Demand Accounts.
Annual
Equivalent Rate (AER)
The
amount you will be given for any money
held in a savings account is presented
to you as a percentage Annual Equivalent
Rate (%AER). The AER is given to
demonstrate what your interest return
would be if the interest was compounded
and paid annually instead of any other
period (e.g. monthly).
Documentation
In
order to facilitate the opening of
regular or offshore savings accounts,
banks are required to have completed the
necessary Due Diligence on the applicant
in order to confirm their identity.
Therefore the banks are legally obliged
to request documentation of proof of
identification (such as a passport) and
up to two separate items that prove your
address. Typically, this proof of
address can be a utility bill or a bank
statement.
Fixed
Interest Accounts
The
Interest rate offered or advertised is
fixed for the term of your account. The
interest rate offered is generally
higher than that available on a variable
rate Notice or Access Account.
Gross
This
term generally means before
deductions, when banks are promoting
their products you will often see the
interest rate followed by the term “gross”.
This will generally mean the rate of
interest earned on a deposit account
before the deduction of tax.
Multi-Currency
When a
bank is offering their products in more
than one currency. The most popular
currencies are the United States Dollar
(USD), the British Pound (GBP) and the
Euro (EUR).
Notice
Accounts
A
savings account on which the customer is
contracted to give a specified notice
period before making a withdrawal,
usually in return for higher interest
rates. A penalty may be imposed by the
bank if a withdrawal is made prior to or
without the agreed notice period being
undertaken.
Retention
Tax
A
mandatory tax placed on income (interest)
that is earned on savings accounts in a
country that is not the resident's home
country. This only applies to countries
that are members of the European Union
(EU). This is deducted at source by the
bank providing the savings account and
is currently at a rate of 20% p.a.
Variable
Rate Accounts
As the
name suggests the interest payable on
these accounts is not fixed, and can be
changed at any time by the bank
providing them.
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