- Fall head-over-heels for saving again! Yuh is now offering 1% INTEREST RATES on your cash.
- The more love you give, the more you get back: savings interest means you don’t pay for your account, Yuh pays you! (Up to a maximum of 1’900 CHF per year).
- Discover why savings interest is back on the scene, why it took so long and what it means for your money.
A tale as old as time: love, loss and interest rates
Interest on capital is as old as human society and seems to be deeply rooted in our need for justice and fair compensation. For creditors (lenders), interest always means earnings; for debtors (borrowers), it means an expense, the cost of the contract created.
The first documented evidence of an interest system dates back to the Sumerians in 2400 BC. The concept of interest has always been in the crossfire of criticism due to the dubious morality of taking more money from someone who is in need enough to borrow it: Plato believed the act of taking interest was harmful to the state and for Aristotle it was even a “form of acquisition against nature”.
Although interest has many interesting aspects to discuss, we focus here on Yuh’s latest perk: savings interest.
The first documented evidence of an interest system dates back to the Sumerians in 2400 BC. The concept of interest has always been in the crossfire of criticism due to the dubious morality of taking more money from someone who is in need enough to borrow it: Plato believed the act of taking interest was harmful to the state and for Aristotle it was even a “form of acquisition against nature”.
Although interest has many interesting aspects to discuss, we focus here on Yuh’s latest perk: savings interest.
At Yuh, we want interest to work in YOUR interest
We know saving can be tricky, and your hard-earned money shouldn’t sit stagnant in some bank account – or worse, trickle away due to inflation and negative interest rates. Instead it should grow, through smart investment or juicy savings interest.
It is possible for savings to bear fruit. But with an ongoing worldwide financial crisis, our inner pessimist can’t help but worry about what other challenges might lie ahead. This uncertainty can turn the most fearless honey badgers into sensible squirrels, tucking money away safely and preferring the classic reliable savings account over riskier investments.
Totally understandable, of course, because shares and crypto need a bit more investment of their time and knowledge before making a financial one. A savings account seems straightforward in comparison: pay in money, get regular interest returns from the bank, get extra money on the side.
Unfortunately, it’s not that simple. As a result of the 2007/08 financial crisis, the central banks-controllers of the base interest rate-devised a plan to stimulate the economy again: a rigorous low interest rate policy on savings. On top of that, we currently have high inflation (2.3%) in Switzerland, meaning that your savings are losing purchasing power. Luckily, compared to the EU’s rate of 7.1% in May 2023, this is still relatively low.
It is possible for savings to bear fruit. But with an ongoing worldwide financial crisis, our inner pessimist can’t help but worry about what other challenges might lie ahead. This uncertainty can turn the most fearless honey badgers into sensible squirrels, tucking money away safely and preferring the classic reliable savings account over riskier investments.
Totally understandable, of course, because shares and crypto need a bit more investment of their time and knowledge before making a financial one. A savings account seems straightforward in comparison: pay in money, get regular interest returns from the bank, get extra money on the side.
Unfortunately, it’s not that simple. As a result of the 2007/08 financial crisis, the central banks-controllers of the base interest rate-devised a plan to stimulate the economy again: a rigorous low interest rate policy on savings. On top of that, we currently have high inflation (2.3%) in Switzerland, meaning that your savings are losing purchasing power. Luckily, compared to the EU’s rate of 7.1% in May 2023, this is still relatively low.
Recent interest rate developments: why your cash is in good hands with Yuh
As an investor, you receive interest for lending your money to the bank, for the entire term of your investment. How high the interest rate is depends on various factors, such as the investment period, the economic conditions or the base interest rate set by the central banks (which is the rate at which credit institutions can borrow money from those banks).
In Switzerland, the base rate is now 1.75%, up 2.50% from a depressing -0.75% in September 2022. And in the euro zone? Here, the ECB recently decided to raise the key interest rate to 4.00%. Further interest rate changes in the future haven’t been ruled out, so the golden age isn’t quite back yet, but things have started to improve. If the base interest rate rises, the capital market interest rates and inflation do the same.
We swear by the moon and the stars in the sky! The financial world is full of wonders, and interest is definitely one of them. From 1 October 2023, you will receive 1.00% interest on your CHF cash balances and 0.75% on your EUR and USD cash balances. We have removed all caps, so there is absolutely no limit to the interest you can earn.
Interest rates are cumulative. In other words, interest is calculated separately for each currency. Interest is prorated over 365 days and paid annually on 31 December.
In Switzerland, the base rate is now 1.75%, up 2.50% from a depressing -0.75% in September 2022. And in the euro zone? Here, the ECB recently decided to raise the key interest rate to 4.00%. Further interest rate changes in the future haven’t been ruled out, so the golden age isn’t quite back yet, but things have started to improve. If the base interest rate rises, the capital market interest rates and inflation do the same.
We swear by the moon and the stars in the sky! The financial world is full of wonders, and interest is definitely one of them. From 1 October 2023, you will receive 1.00% interest on your CHF cash balances and 0.75% on your EUR and USD cash balances. We have removed all caps, so there is absolutely no limit to the interest you can earn.
Interest rates are cumulative. In other words, interest is calculated separately for each currency. Interest is prorated over 365 days and paid annually on 31 December.
And what was that again about negative interest rates?
This has been the case for almost eight years now: if you have large amounts of savings in your account, you have to pay some banks for the safekeeping of your money. The reason given is usually that the banks pass on the negative deposit interest rate to their investors. Thankfully, the interest rate cut seems to be over for the time being, with more banks hopefully following Yuh’s lead and turning their back on the negative interest rate.
Sure, 1.00% interest on your savings doesn’t make you Bill Gates or Kim Kardashian – especially when you consider that inflation in Switzerland alone is over 2%. But Yuh’s still racing ahead of other banks with our zero account opening and maintenance fees and our attractive interest rate – currently one of the highest in Switzerland. By the end of the year, Yuh pretty much pays you for using your account.
Sure, 1.00% interest on your savings doesn’t make you Bill Gates or Kim Kardashian – especially when you consider that inflation in Switzerland alone is over 2%. But Yuh’s still racing ahead of other banks with our zero account opening and maintenance fees and our attractive interest rate – currently one of the highest in Switzerland. By the end of the year, Yuh pretty much pays you for using your account.
What else you need to know
Before you go, here’s a roundup of the key facts:
- Interest rates will eventually find their way back to all savings accounts, but the financial mills grind slowly, and it’ll take a while for a return to get back to normal.
- Yuh are one of the first financial service providers offering positive interest rates on your savings.
- Savings alone are not enough if you really want to boost your bank balance. At Yuh, we make it easy for you to explore other investment options such as stocks, cryptos or ETFs.
- Simply by reading this article, you’re increasing your money know-how. As Benjamin Franklin said, investing in knowledge still yields the best interest – and he should know, considering his face graces the 100 USD banknote!