Personal Finance: Egg soldiers on to Net

Prudential's new banking services are designed to be Internet- friendly for the 21st century

PRUDENTIAL THIS week launched a new banking and insurance arm called Egg, which is aimed at capturing a larger slice of the younger, technologically-adept market it believes will form the majority of financial consumers in the next millennium.

Egg will initially be launching three products - an instant access savings account, mortgages and personal loans, all of them offering highly competitive rates. The company eventually plans to broaden its range, offering insurance, investments and retirement products.

Mike Harris, chief executive of Egg, says: "Egg is designed for the Internet generation. This is significant, as research has indicated that, by the year 2013, two out of every three financial products will be sold by electronic means. By establishing the foundations now, Egg intends to become the leader and key beneficiary of this financial services revolution."

To attract this new client base, Egg is offering a market-leading instant access account paying 8 per cent gross each year, or 7.72 per cent if interest is paid monthly.

This includes a 0.5 per cent bonus, guaranteed until January 2000, whereupon rates will automatically fall by that percentage, irrespective of what happens to base rates. The same rate is payable on savings between pounds 1 and pounds 250,000, with Egg guaranteeing that, until January 2001, rates paid on its access account will not be lower - excluding bonus - than Bank of England base rates.

For customers who want immediate access to their money, Egg is offering a cashcard option, using Midland Bank and Royal Bank of Scotland machines, with annual interest rates of 7.5 per cent. The first six cashcard withdrawals of up to pounds 500 at a time will be free, but any made thereafter will cost pounds 1 each.

Mortgage borrowers will be able to choose a variety of mortgages, including a variable rate of 7.99 at present, plus a choice of three- and five- year fixed rate mortgages. The five-year fixes offer a choice between 6.45 per cent for a five-year fix, if borrowers are prepared to accept a sliding scale of redemption penalties, to 7.25 per cent if they are not. The three-year deals are similar: 6.79 per cent if one accepts sliding mortgage redemption penalties, 7.25 per cent if not.

Egg is also offering an innovative, cashback-style mortgage. This works by paying a 0.5 per cent cash bonus to borrowers for every year that a customer agrees to keep the loan going. If borrowers decide to repay the loan early, they have to repay the cashback they were first given, minus 0.5 per cent for every year it has been kept.

All of Egg's mortgages will calculate the interest owed on a daily basis, instead of annually, which means that the money they pay into their mortgage account goes instantly towards repaying the loan.

Finally, Egg is offering a new-style personal loan, whereby customers can choose how much they want to repay each month, or the term they will repay it in. Rates will range between 15.7 per cent APR on loans up to pounds 1,000, falling to 10.9 per cent APR on borrowings between pounds 10,000 and pounds 15,000.

Unlike traditional personal loans, customers can reduce or fully pay the loan by making additional repayments at any time they like, without penalty. Or they can even take a break from repayments of up to three months each. The interest is proportional to the outstanding balance.

All three services are available 24 hours a day, seven days a week. Customers will be allocated a named "contact" who will deal with their requests.

Call 08450 399399, or see the Egg website on www.egg.com

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Editor-in-chief - Financial Services - City, London

    £60000 - £70000 per annum + benefits : Ashdown Group: A highly successful, glo...

    Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

    £25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

    Guru Careers: Management Accountant

    £27 - 35k + Bonus + Benefits: Guru Careers: A Management Accountant is needed ...

    Guru Careers: Project Manager / Business Analyst

    £40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...

    Day In a Page

    General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

    Miliband's unlikely journey from hapless geek to heart-throb

    He was meant to be Labour's biggest handicap - but has become almost an asset
    General Election 2015: A guide to the smaller parties, from the the National Health Action Party to the Church of the Militant Elvis Party

    On the margins

    From Militant Elvis to Women's Equality: a guide to the underdogs standing in the election
    Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

    'This is the battle of young Egypt for the future of our country'

    Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
    Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

    Why patients must rely less on doctors

    Improving our own health is the 'blockbuster drug of the century'
    Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

    Flesh in Venice

    Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
    11 best anti-ageing day creams

    11 best anti-ageing day creams

    Slow down the ageing process with one of these high-performance, hardworking anti-agers
    Juventus 2 Real Madrid 1: Five things we learnt, including Iker Casillas is past it and Carlos Tevez remains effective

    Juventus vs Real Madrid

    Five things we learnt from the Italian's Champions League first leg win over the Spanish giants
    Ashes 2015: Test series looks a lost cause for England... whoever takes over as ECB director of cricket

    Ashes series looks a lost cause for England...

    Whoever takes over as ECB director of cricket, says Stephen Brenkley
    Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

    Fishing is on Nigel Farage's mind

    Ukip leader casts a line to the disaffected
    Who is bombing whom in the Middle East? It's amazing they don't all hit each other

    Who is bombing whom in the Middle East?

    Robert Fisk untangles the countries and factions
    China's influence on fashion: At the top of the game both creatively and commercially

    China's influence on fashion

    At the top of the game both creatively and commercially
    Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

    The man known as GOD has a reputation for getting the job done

    Lord O'Donnell's three principles of rule
    Rainbow shades: It's all bright on the night

    Rainbow shades

    It's all bright on the night
    'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

    Bread from heaven

    Dutch survivors thank RAF for World War II drop that saved millions
    Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

    How 'the Axe' helped Labour

    UK will be 'run for the wealthy and powerful' if Tories retain power