Delay in ISA transfer

Are you sure you will lose the interest ? I used to delight in writing cheques and paying a matching cheque in on the same day with the intent of getting a statement which showed a cheque written cleared

*before* a cheque in. Unfortunately (:-) ) I was never able to. I reckoned they must have a special routine to watch for such instances and prevent them from happening to save their embaressment ...

How they transfer funds will be in the terms and conditions given to you when you first opened the account, along with any fees (not all do free transfers).

I am not sure why they do not do electronic transfers.

I hope that once the cheque is "processed" at B - then I will get interest from that point on - It is the period whilst "the cheque is in the post" that I am concerned about - could be at least a week

Just a thought, but if you did an online ISA, and then transferred away, they may transfer funds to the new provider electronically???

Can't really do much about the lost interest. Apart from complain to the relevant ombudsman about the length of time taken and asking why the previous provider should keep the interest when you aren't getting any.

I spoke to Birmingham Midshires to get some info on this.

It appears to be standard procedure for virtually all isa providers to transfer by cheque. the terms and conditions probably state that it can take up to 8 weeks for the transfer to be effective. but BM have said that in the past they have credited interest to the account from the day the cheque was issued, when they were the receiving institution.

so ask your new provider if they will backdate the interest to the day the cheque was issued from the previous provider.

Hope that helps.

In message , alwaysplanning writes

8 weeks to transfer funds from one bank to another is outrageous. In the Ts & Cs, do they state that first they have to grow to the tree to make the paper to make the cheque? I can't believe that banks really transfer money by cheque. I have had a few electronic transfers by BACS (one of them being where I raided my ISA account), and the money was in my current account two days after making the transfer request (ie on the 'third' day).

It is really by cheque. For some reason during a transfer several years ago I actually received the cheque that _I_ was supposed to take to the new provider! Bizarre.

I'm currently waiting 3 weeks for my ISA to be transferred. The old provider still haven't got round to closing my account :-( The new provider have promised to back-date interest from the date the cheque is written (although presumably I have 3 weeks of interest at a low rate from the old provider).

It's crazy they can't get together to have an electronic system to do this. It almost makes you wonder whether it's worth bothering with an ISA when they are so cumbersome to operate.

Jeremy

I've just been told this is the case for Alliance & Leicester; interest backdated to the date of the cheque. These banks should really make that clear as the notification of "30 days" to process the transfer request seems to be worrying us needlessly! In these circumstances it would seem that perhaps only 1 day's total interest is lost on the capital sum and just the difference in interest rates between the two accounts on the time it takes Bank A to get its act together. I can live with that, but I wish I'd been saved the anxiety of imagining a cheque gathering dust!

Nigel