thanks all - it seems we have some misunderstandings here - not a surprise considering it is very complex.
I will try to clarify, but let me know if it is still not clear
@Robertiwills is correct, the cash savings that are held in Dozens’ Grow section are actually held in a separate account with Bank of Scotland. I was confused by the reference to ‘Lloyds’, but it is the Lloyds Banking Group, that’s true.
It is conceivable that they could decide to charge us a negative interest rate on that account, which would therefore increase our costs, that’s true. This is one of the unusual issues associated with the frankly weird idea of ‘negative interest rates’.
I will definitely let you know if anything is decided or planned on this, but I can say that we have no plans to charge for this or pass it on, but of course this might have to be reviewed depending on what those rates are and how long it lasts for. We would certainly let customers know with plenty of notice in this case, and their funds can always be kept in e-money accounts instead.
In terms of our business model, this would still not change anything. Money in these accounts is there as a means to allow customers to put money into investments, not to be held here indefinitely.
I think @daedal is correct in that the banks who provide these accounts will probably find ways to minimise the knock-on effect of negative rates by simply paying 0% interest, but I only speculate as this will be a new situation for most of us, but the comment about the Japanese experience is certainly interesting (and now there’s experience in EU as well)
In terms of us discussing our business model, we try to be as transparent as possible, so don’t worry @Peter
The point here is to be ‘aligned’ in terms of incentives. If interest rates are negative, I presume this is intended by the BoE to get people to put their money into circulation in the economy. Dozens believes that a way of putting money to good use in the long term (for customers, business and the wider economy) is through investing rather than consumption & spending, and so our incentive to help customers and not have to pay fees on ‘custody’ is aligned.
I believe that the Bank of England would agree, so no negotiation required