Fans score a costly own goal with football finance
Football branded financial products are now big business. But are they any good? James Daley reports
Saturday 19 August 2006
It might seem as if the World Cup has only just come to an end, but Premiership football kicks off this afternoon and the clubs want your money. Fans may have already splashed out £40 a new strip, but football-branded financial services products, from credit cards to mortgages, are becoming ever more important sources of revenue.
On the plus side, all profits made by the clubs are reinvested into their facilities and coaching, often in the development of the club's youth squad. But while football finance gives fans another way to show their support, they are often poor value.
The average football club savings account pays a starting rate of interest rate of just 2 per cent a year - some 2.75 per cent below the current Bank of England base rate. Rates sometimes increase once the balance in your account passes £1,000 or £2,000, but many of the top rates are still at least 1 per cent below the market-leading rates. In other words, savers who opted for a market leading savings account, paying around 4.5 per cent interest, could beat the 1 per cent donation paid by the typical savings account and still earn a much higher rate on their savings.
There are exceptions. Wolverhampton Wanderers, which offers an account run by Birmingham Midshires, pays a competitive 4.5 per cent, and still donates 0.3 per cent to the club.
Most club savings accounts for children are also competitive. Although Arsenal's adult savings account pays starting interest of just 2.05 per cent, its children's account pays a more respectable 4.5 per cent. The club receives 1 per cent of all balances from Britannia Building Society regardless of whether the accounts are held by adults or children.
However, there are many more examples of clubs which offer their supporters a poor deal. The same rule applies when it comes to football club insurance deals. Arsenal and Manchester United both offer car, home and travel insurance to customers, backed by Endsleigh Insurance.
When we asked the price comparison site Moneysupermarket to run a comparison of its prices against the market leaders, it concluded that the clubs were generally more than twice as pricey as the cheapest provider.
Although club-related personal loans are also relatively uncompetitive, the few mortgage packages that are available are better value. Man United and Man City offer competitive two-year variable rates of 4.8 per cent - not market leaders, but not far off. With mortgages and insurance, the club tends to receive a one-off commission from the provider for bringing them the business. Credit cards, like savings accounts, provide an ongoing stream of income to your club.
Almost all of the club credit cards are run by MBNA, and charge an interest rate of 15.9 per cent - not best buy, but not bad either, especially since from today, all MBNA football card customers will also qualify for MBNA's reward scheme. Customers get a point for every pound they spend on their card. Points can be exchanged for gifts and days out - or, in the case of football cards, for merchandise.
Fulham card holders can exchange points for shirts and match balls. Man United cardholders are entered into a weekly prize draw for similar gifts - if they spend at least £50 a week.
Andrew Hagger of Moneyfacts, the comparison service, says that whilst there are many more competitive rates on the market, cards can be worthwhile for sensible borrowers. Although MBNA would not disclose what percentage it pays to clubs, Hagger suggests that fans could probably give more back by taking out a market leading cash-back card, and donating the refunds.
Norwich & Peterborough Building Society has signed a deal with the Football League, to offer 20 new "Club Saver Accounts" for clubs from the Championship to League Two as well as some Conference teams. These won't necessarily be better value than the accounts offered by the big clubs, but your small local team is, arguably, more deserving of help.
Big football clubs can behave like big banks
* Manchester United may not have won the Premiership for four years, but the club continues to lead the way in financial services, selling everything from credit cards to mortgages to cash Isas. However, while loyal fans may be a captive audience, financial experts think supporting the club this way could be an own goal.
* Rather than paying top rates, the club goes in for gimmicky bonuses based on the team's performance. For example, savers will receive an extra 1 per cent interest this month and next, due to the club's qualification for the Champions League, while insurance customers may get a discount on renewal premiums depending on how many goals the club scores in a season.
* Peter Gerrard, of price comparison service Moneysupermarket, says: "If people really want to help their team, they'd be better looking out for the cheapest policy and giving the money they save to their club."
* However, Stephen Falk, the director of Manchester United Financial Services, says the club's aim is to find partners with products which are amongst the top quartile in their sector. "We don't try to have the absolute market leading rate because we're creating products which are available for everyone," he says.
* Falk also points out that Manchester United fans don't seem to be able to get enough of their club's financial products. While MU Finance had just 35,000 customers five years ago, it now has some 443,000.
Independent Partners: See how much you could save by switching credit cards. Compare now
Jennifer Lawrence attacks mass media again over body image
scienceScientists find the answer to a question that even puzzled Darwin
A very timely Great Train Robbery and a frantic 24 Hours in A&E among the highlights
arts + entsThe 'Friends' actor on his new role as campaigner on addiction issues
- 1 Facebook 'self-censorship': study records when you don't post to find more ways to share
- 2 Sun will 'flip upside down' within weeks, says Nasa
- 4 Vitamin pills are a waste of money, offer no health benefits and could be harmful - study
- 5 Children evacuated from swimming pool after prosthetic leg mistaken for paedophile
Exclusive: Young people ‘want UK to stay in Europe’: Four in 10 adults aged 18 to 24 are ‘firmly in favour’ of membership, poll shows
Fox News presenter tells viewers it is a 'fact' that both Jesus and Santa Claus are white
You can STILL be jailed for being a republican, government confirms, and it remains illegal to even 'imagine' overthrowing the Queen
Kiss and yell: Italian protester charged with sexual assault after kissing riot police officer
Fighting back: the woman giving a voice (and 49,999 others) to the victims of sexism - by giving an airing to their horror stories
PM denies two child limit for benefits is part of Tory welfare policy
- < Previous
- Next >
iJobs Money & Business
£500 - £550 per day: Cornwallis Elt : Business Analyst Cross Border Complia...
£44999 - £60001 per annum + Benefits: Pro-Recruitment Group: A Top Tier firm i...
£50000 - £75000 per annum + benefits + bonus: Harrington Starr: Implementation...
£50000 - £65000 per annum + benefits + bonus: Harrington Starr: Project Manage...
Day In a Page
A two-bedroom flat with an open plan kitchen and two balconies, close to Arsenal station
A six-bedroom farm house with separate, detached cottages and 371 acres of land
A two-bedroom cottage with parquet floors, chunky beams and an open fireplace
A Grade II-listed home with six bedrooms, secluded landscaped gardens and views across Hadley Green
A Grade II-listed mansion with two apartments and a cottage, near Gretna Green
A three-bedroom Grade II-listed mews house with vaulted ceilings and roof garden
A spacious Grade II-listed family home with annexe and equestrian facilities among four acres of land in Itchingfield
A four-bedroom home with exposed brick walls and open fires in the picturesque village of Northill
A Grade II-listed property with five bedrooms and unique tower, overlooking Hastings Old Town
A charming five-bedroom detached family home, set within half an acre in Kew
A two-bedroom maisonette set on the top two floors of a period building, close to Kentish Town Tube.
Take advantage of the extra space provided by former stables and outbuildings at this five-bedroom farmhouse.
This three-bedroom Victorian terrace is near to Queen’s Road Peckham station, Nunhead station.
A five-bedroom modern house with terrace, swimming pool, Zen treehouse and large carp pond
An unexpected gem with four bedrooms, remarkable vaulted reception and a galleried study area
A five-bedroom house in one of Lymington's most sought after tree lined avenues, moments from the marinas and sailing clubs
A grand early 19th century B&B close to the historic harbour, with four en suite bedrooms
A four-bedroom, 17th century home with walled gardens, a landscaped terrace, cellar and open fires
A six-bedroom house with five bathrooms and four reception rooms spread over 4,000sq ft of luxury living space
A stunning three double-bedroom apartment with two decked terraces in the exclusive gated community, Bromyard House
A 10-bedroom period, family home amid beautiful surroundings in the centre of the Wentworth Estate in Longcross village
A stylish three-bedroom apartment with two bathrooms and private landscaped garden, moments from Fitzroy Square
A Grade II-listed Elizabethan barn with landscaped gardens, exposed elm beams and four bedrooms, all with lovely views
A six-bedroom family home, dating back to 1280 with four reception rooms, barn, swimming pool and tennis courts in Harwell
A spacious two-bedroom flat, refurbished to a very high standard with private landscaped garden, close to Kentish Town station
An exceptional two-bedroom apartment with balcony and underground parking in the centre of Richmond
A one-bedroom, luxury, duplex apartment in the grand landmark building, Imperial Hall
Run a fabulous boutique shop, live above it in a one-bedroom flat and let a second one-bedroom flat that comes part and parcel
A Grade-II listed, thatched cottage in Hundleby village, with five bedrooms, a coach house and three and a half acres
A spacious two-bedroom flat in the heart of Hoxton Square with wooden floors and roof terrace
A five-bedroom family home with stunning pool and gym complex set among two acres of land
A six-bedroom period house with heated swimming pool and a separate two-bedroom annexe cottage in Townlake, £795,000
A spacious and contemporary two-bedroom flat arranged over three floors, with garden patio close to St George Square, £600,000
A one-bedroom flat in a beautiful Regency building opposite the beach in Kemp Town, £190,000
A two-bedroom flat with London skyline views close to Surrey Quays. £395,000.
A seven-storey tower with three bedrooms and a stunning roof terrace. Guide price: £850,000.
A 16-bedroom country pile with nine reception rooms, four self-contained flats and a 13th century Peel Tower. £850,000.
A classic six-bedroom Victorian Manse house 10 miles from Edinburgh. £495,000.
John Lennon's childhood home in Liverpool to be sold at auction. Guide price: £150,000-£250,000.