KEY POINTS:
What is it called and what sort of savings product is it?
The PSIS online call account.
Which company is behind it?
PSIS is a Wellington-based co-operative with branches around the country. Its focus is on "helping families to prosper". It was founded in 1928 as a co-operative, helping New Zealanders working in the public service with low-cost financial services. That makes PSIS one of the longest-serving Kiwi financial organisations. PSIS' website states the co-operative is "one that has, from the beginning, put people before profits". It adds: "Today, we offer services to all New Zealanders and our mission is to help everyday families prosper in every way we can. We do this a number of ways, [including] personal banking only - we don't do business banking, so we're fully focused on helping you, [and] we'll actively show you how to avoid paying fees."
Who is the target market?
Anyone looking for a good place to park their money.
What return does it offer?
Its current rate is 8.4 per cent. Interest is calculated daily and paid monthly.
When was it launched?
December last year.
What other products is it like or is it competing with?
PSIS is pitting itself against all of the other online call accounts, including those from the banks and SBS.
Is it long term, short term or medium term?
As it's a call account, it is viewed as a short-term investment vehicle.
What is the unique selling point?
Its rate is attractive, matching Rabo Plus, Westpac and KiwiBank. Indeed, an advantage over the latter two is that their top rates are conditional. There are no account or transaction fees.
How strong a stomach do you need for it?
This is one of the lowest-risk options available for investors. Late last year, PSIS went through the ratings process and now has a BB+ rating from Standard & Poor's, which is lower than that of the banks.
What's the hitch?
There are not too many hitches. The main one is its lower relative credit ratings to competitors. But Standard & Poor points out this is largely a function of size.
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