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Nuki&#39s Eye

There is a nice little earner coming your way, Mr IFA, and it has not a

shred of insurance or investment tied up with it. Better still, 99.9 per

cent of your clients will thank you – perhaps even hug you – for selling


The product is called Intelligent Finance (IF for short) and comes from

the boring old Halifax. If you all start selling it from its launch in

July, you will make money, your clients will make money and the Halifax

will make money.

You would be right to think there are always losers in schemes of this

type. But if you think IF is too good to be true, think again.

I say this because the losers in this case go by names such as Barclays,

Lloyds TSB and HSBC.

Every penny that you, your clients and the Halifax make out of IF will

come from them – the traditional clear-ing banks. The total amount of money

up for grabs stands at about £5bn a year. That is the sum which the

clearing banks are ripping their ordinary account holders off by and the

sum which Halifax is proposing to redistribute.

At the helm of IF is Jim Spowart, the nearest thing the banking world has

to Robin Hood. His gift – used to great effect by both Direct Line and

Standard Life in the past – is to spot fat in the banking system and swipe

it. The spoils go to him, his employers and the millions of smart consumers

who flock in on the back of it.

The £5bn in swag Spowart currently has his eye on is the interest the

traditional clearing banks make from lending customers cash that they

already own.

For example, if you have £3,000 outstanding on a credit card,

£500 in a current account and £2,500 in a savings account, you

owe your bank nothing. However, it will charge you about 18 per cent on the

so-called loan of £3,000 while paying you nothing, or next to nothing,

on the two accounts that are in credit.

With IF, this will not happen. Customers will only be charged interest on

money they actually owe.Moreover, every account you have will be taken

account of – mortgage, credit card, personal loan, current account, savings

account, everything. It is as if, once a day, a top accountant steps into

your bank free of charge and rebalances all your accounts to give you the

best possible deal.

The end result is that, with IF, if you owe exactly nothing, you will pay

exactly nothing in interest. Alternatively, if you do owe something,

interest will be charged on the debt at your lowest active rate, for

example, your mortgage rate.

If you have no net borrowings and are, therefore, genuinely in credit,

interest will accumulate at the highest active rate, your credit card or

savings rate.

If the truth be known, this is not an original idea – the Virgin One

account is based on exactly the same principle. However, with IF, all your

separate accounts (Visa, current, savings, etc) continue to exist, giving

you a better picture of your finances.

Moreover, unlike Virgin, you will not need to take out a mortgage to

qualify as an IF customer.

And the incentive for IFAs to recommend IF products? Commission on

mortgages, credit cards, personal loans and even savings accounts.

It will not make you rich overnight but it will roll up and over time it

could bring in several thousands of pounds a year. Not bad for a product

that in an ideal world would sell itself millions of times over.


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