Record inflows into Octopus Cash

Octopus Investments today announced that its cash management solution, Octopus Cash, received £10.4 million of new deposits in the week commencing 16th March, a record for a single week, as financial advisers look for safe havens for their clients’ cash. This also helped make Q1 a record quarter for Octopus Cash, with £91 million in new inflows and £44 million in net inflows (after withdrawals).

This took the platform past the milestone of £300 million in cash deposited, which now stands at £302 million. However, this figure is set to rise again quickly, with more than £34 million of new applications currently being processed.

This has been driven by a 46% rise in the number of inbound enquiries in March, compared to the average month. The average case size has also increased by 26% from £133,000 to £166,000, with advisers and their clients keen to take advantage of the significant FSCS coverage that Octopus Cash offers.

Octopus Cash allows individuals, businesses, charities and trusts to find a top tier return on their cash savings without the need for regular switching. It offers a notice account and fixed-term deposits of between 35 days and 24 months, with top tier rates and FSCS coverage of up to £680,0001.

It does this by splitting customer deposits between its different partner banks, which offer £85,000 of FSCS coverage per customer, per bank. This means advisers and their clients can currently access up to 8 times the standard FSCS protection limit by opening a single account with Octopus. The minimum deposit is £1,000.

The popularity of Octopus Cash among financial advisers has been supported by the Cash Hub, which is an easy to use platform facilitating access to key client information and a smooth onboarding process.

Caroline Flagg, Head of Octopus Cash, comments:

“In the last few of weeks we’ve seen a significant spike in the number of advisers using Octopus Cash for their clients. That’s simply because in the current climate, cash offers the ultimate security for many people. This might be someone postponing making an investment into equity markets, or perhaps someone who has liquidated some of their existing holdings to hold a portion in cash.

“We’ve also found that some individuals and businesses hold large amounts of cash with a single bank, often several times the FSCS limit. In those cases, advisers and their clients are now keen to spread this across several banks to make sure they are covered. Rather than opening new accounts with six or seven different banks, which can be extremely time consuming, Octopus Cash makes that process quick and easy with one single account.

“While the Bank of England’s recent base rate decision was more bad news for savers with high street banks, the challenger banks on our platform continue to offer top tier rates. In some cases, they have actually put their rates up in the last week. Not to mention the fact you don’t have the hassle of shopping around and switching.”

In the longer term, Octopus Cash will also be integrated into Seccl’s technology stack. This means that any firm building a platform using Seccl’s API first technology will have easy access to a top tier interest rate.

Seccl, which was acquired by Octopus Group last year, provides a platform technology solution which allows for advice firms, investment managers and fintechs of all sizes to operate their own investment platform.

1 For a 1-year fixed term deposit as of 24th March 2020

For more information about Octopus Investments click here 

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