Goldman Sachs challenges UK banks as it reopens applications for Marcus accounts

Goldman Sachs Group Inc (NYSE:GS) said it has reopened applications for its Marcus online savings accounts for customers in the UK as it looks to take advantage of an upswing in cash savings among British households during the coronavirus (COVID-19) pandemic.

The Wall Street bank said conditions in the savings market had changed since the summer of 2020 when it suspended applications for the accounts amid a surge in demand from customers wanting somewhere to save cash that had piled up during lockdown.

The Marcus accounts had initially offered higher-than-average interest rates of around 1.05% last year. However the sharp cuts in interest rates from central banks during the pandemic pushed the bank to slash its rates to 0.5%, although still higher than most easy-access accounts.

The re-emergence of Marcus will present a new challenge to the UK’s high street banks, who will find themselves at a disadvantage unless they can offer savings rates similar to the US bank.

There is the prospect of yet more competition from across the Atlantic, with JP Morgan Chase & Co having said that it will launch its Chase consumer bank in the UK in 2021.

Shares in Natwest Group PLC (LON:NWG) were down 0.5% at 171.3p in early trading on Friday, while fellow high street bank Lloyds Banking Group PLC (LON:LLOY) dropped 0.6% to 36.9p and Barclays PLC (LON:BARC) fell 0.3% to 145.6p.

Story by ProactiveInvestors