We are announcing a temporary reduction in interest as a result of an increased provision we are making for the impacts of the current economic climate.
The COVID-19 pandemic is having a major impact on the economy. Central banks have cut interest rates, share prices have fallen and banks have cancelled their dividends for investors. Economic activity has reduced and, while the government is providing unprecedented support, individuals and businesses are having to adjust.
It is in this context that we are announcing a temporary 50% reduction in interest. This interest will go to the Provision Fund. This reduction is expected to last for the remainder of 2020.
We have therefore decided on an interest reduction of 50% for the remainder of 2020. We will keep the interest reduction under review every 30 days and update you in your monthly investor statement. If conditions improve, rates will rise as quickly as possible.
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What this means for interest rates | | |
| | |
| Annual rate so far this year | Annual rate for the rest of the year* | Effective annual rate in 2020*
Access | 3.00% p.a. | 1.50%p.a. | 2.00% p.a.
Plus | 3.50% p.a. | 1.75%p.a. | 2.33% p.a.
Max | 4.00% p.a. | 2.00%p.a. | 2.67% p.a.
*Assuming the interest reduction applies for eight months.
The interest earned on each investor’s existing personal investments will depend on the original interest rate of those investments.