JPMorgan Chase & Co. (JPMC) is offering a 1.5% interest rate to customers with a savings account at its UK digital bank, Yahoo! Finance reported Monday, March 28.
This decision should trigger an interest rate war between financial institutions. The average rate on a UK savings account during the first quarter was 0.45%, according to Swanlowpark.
JPMC said the rate will be available to new and existing account holders. It will be promoted on the Chase app.
Last January, the financial giant announced the launch of its first overseas retail bank in more than 200 years of history. Sanoke Viswanathanhead of JPMC’s international consumer division, said the bank planned to invest in the new UK operation and become a “serious force there”.
Read more: JPMorgan Chase plans UK digital retail banking rollout
The initiative, dubbed “Project Dynamo”, had been in development for two years. Viswanathan said the project will allow customers to do all their banking with JPMC and not have to use other institutions within a few years.
Under the program, customers can deposit up to 250,000 pounds ($327,746). There are no fees. The savings account should be followed by other products this year.