US, has introduced Way2Save, an automatic savings programme which
at first glance appears to be based on rival Bank of America’s
(BofA) Keep the Change programme, a runaway success since its
launch in 2005.
Way2Save, which is to be promoted by Wachovia’s largest ever
advertising campaign, offers bonus payments for customers who make
regular deposits to their savings accounts.
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The Wachovia programme requires its customers to link a current
account to a Way2Save savings account. Each time the
account holder uses their debit card, makes an online bill payment
or has funds automatically debited from the current account, $1 is
transferred to the savings account from the current account.
Customers can also opt to transfer up to $100 a month from their
checking to savings account.
The bank gives two examples of the possible savings a customer
could make: if someone makes 23 monthly Check Card purchases, four
monthly electronic payments and a recurring monthly transfer of $25
into savings, for example, they can expect to save $671, including
interest and bonus, during their first year. A customer who makes
10 monthly Check Card transactions, two monthly electronic payments
and a $100 recurring transfer each month could save $1,446.
Wachovia is tempting customers with a competitive savings rate of 5
percent and will pay a 5 percent bonus in the first year up to a
maximum of $300, with a bonus of 2 percent on offer for the second
and third years the Way2Save account is in operation. A bank
spokesperson told RBI that a fail-safe measure will ensure
that a customer does not incur penalty charges if a savings account
transfer could result in an overdrawn account. “Way2Save
withdrawals are made in a batch at the end of the day, and the
system is set up to ensure that if that withdrawal would push the
customer into overdraft, then that day’s transfers would be
cancelled completely,” she said.
Wachovia will promote Way2Save in a series of TV, print, and online
ads, due to run from the middle of January.
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By GlobalDataBofA’s Keep the Change, one of the most successful product
innovations of recent years (and winner of an RBI award in
2006), offers its customers a bonus of up to $250.
BofA’s scheme automatically rounds up to the nearest whole dollar
each purchase made with a BofA debit card, and deposits the change
into the customer’s savings account at the end of the day, with the
bank matching 100 percent of each transfer for the first three
months and contributing 5 percent a year thereafter.
A spokesperson from BofA told RBI that, as of January
2008, Keep the Change has “helped” 6.6 million customers save $778
million.
A watered-down version of the BofA automatic savings programme was
launched in the UK last February by the country’s fifth-largest
bank, Lloyds TSB, which rolled out an savings programme called Save
the Change.
Lloyds TSB matched 100 percent of the Save the Change transfers for
the first two months after its launch in February, up to a maximum
of £50 ($97) each month.
