Bank accounts
Any payments made into your Nucleus Platform products are received into a pooled bank account, held in the name of one of the following:
the trustee for SIPP products
the provider for ISA and GIA
the Nucleus provider on behalf of the offshore bond provider – RL360 Insurance Company Limited
Please see the relevant product's terms and conditions for confirmation of the trustee/provider.
These accounts hold money for other customers, and each customer’s cash holdings are recorded separately in our records but not in the banks’ records. Your cash within the pooled bank account is known as your product bank account, and the balance is visible at any time via your Nucleus Platform online account.
You can hold a cash balance on the platform to help pay service fees and charges, or to act as a temporary haven when the markets are volatile.
This facility isn’t designed to hold large balances of cash for long periods of time. Various alternatives are available for customers seeking to make a return on their cash.
We’ve partnered with Bondsmith, a Financial Conduct Authority (FCA) regulated provider of cash solutions, to offer access to a diverse range of fixed term deposit accounts with attractive interest rates from banks and building societies.
NS&I products, money market funds, lower risk rated model portfolios and/or gilts and bonds purchased through a stockbroker are also available.
Our approach to cash interest
Our active management of customer cash means we can credit you with a competitive rate of interest on cash in your product bank account.
We retain some of what’s earned so we can keep our charges low, as well as investing in our technology, propositions and in providing higher service levels. Our aim is to deliver excellent financial outcomes for our customers, and ultimately help make your retirement more rewarding.
Our interest sharing policy is currently under review and will likely change when customers are upgraded to the new platform.
For those customers that are part of the soft launch of our new Nucleus Platform, the rate of interest we're sharing is shown below.
| Month | % interest earned | % interest paid |
|---|---|---|
| September 2024 | 4.66% | 1.83% |
| October 2024 | 4.66% | 1.83% |
You can view the rates we’ve previously paid James Hay customers on the James Hay banking page.
Typically, should there be changes to interest rates the Treasury team will use its market knowledge to negotiate the best rates offered at the time, which may allow you to earn more.
We only use banks which are authorised by the Prudential Regulation Authority, regulated by the Financial Conduct Authority and Prudential Regulation Authority, and are covered by the Financial Services Compensation Scheme (FSCS). More details on your financial protection can be found at fscs.org.uk.
- Each bank must:
- have a UK banking licence
- be authorised by the Prudential Regulation Authority
- be regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
- They must also be rated at least category ‘BBB’ or higher by one or more of the leading credit agencies Fitch, Moody’s or Standard & Poor’s. All 16 banks currently on our panel are at least ‘A’ rated.
- As well as credit ratings, our due diligence covers several metrics which are a combination of quantitative metrics, derived from financial statements, and qualitive metrics gained from media monitoring and service reviews. We also consider the environmental, social and governance (ESG) credentials of the banks we select.
- While we use longer term deposit products to gain a better interest rate, we perform daily liquidity monitoring which, coupled with cashflow modelling, helps ensure we have sufficient cashflow to meet your needs.
When we use these longer-term deposits, we don’t deposit more than 50% of the cash available to deposit, with a single bank. This varies by product/platform but ensures a minimum diversification to at least two banks, but typically it will be more.
Below are some commonly asked questions and answers in relation to product bank accounts.
The product bank account represents each customer’s cash holding for their Nucleus products. This money is held in a pooled bank account in the name of the trustees for SIPP products, in the name of the provider for ISA and GIA, and in the name of RL360 for the Offshore Bond.
This pooled bank account also holds money for other customers, and each customers holdings are recorded separately in our records but not in the banks’ records.
The product bank accounts are designed to facilitate the movement of money within Nucleus products, including contributions and subscriptions, transfers in and out, investment purchases and sales, as well as for the payment of any withdrawals.
Any charges incurred are also normally paid from the product bank account, including Nucleus’ charges as well as those due to investment managers, fund providers, financial advisers and other third parties as required.
The Financial Services Compensation Scheme (FSCS) protection limit (currently £85,000) applies separately to each bank we use, to protect your money in the unlikely event of the failure of the bank. Please note that money held by customers in fixed term deposit or notice accounts from our SIPP and GIA Cash Panel are covered separately by the FSCS, but this limit does include any personal or joint accounts customers hold with banks outside of their Nucleus products.
Please also note that cash held in the Offshore Bond product bank account is held in the name of RL360. As RL360 are a corporate client they are unlikely to be eligible for compensation in any jurisdiction.
If we’re using more than one bank, we may spread the cash held in your products across multiple banks in order to maximise the interest return and increase the potential level of FSCS protection.
We’ll only select banks rated by leading ratings agencies in the ‘BBB’ category or higher for this purpose. Please note that we may change this minimum rating from time to time depending on the economic circumstances.
If a bank is unable to pay us back all the customer money we hold with them (so there is a shortfall) we have to share that shortfall across all of our customers for whom we are holding client money. If 10% of our pooled cash were with a particular bank and that bank could only repay half of this amount, then each customer would have a potential shortfall of 5% of their cash balance. Please note that in practice, if the shortfall is less than £85,000 per customer, the FSCS would cover the shortfall amount. This applies for cash across our SIPP, ISA and GIA products, although SIPP funds are kept separate from those that sit within a GIA or ISA.
The product bank account is designed for holding cash for short periods of time, while investments are being made or withdrawals are being paid, and so it’s not considered to be a long-term investment option.
There’s no minimum balance to be held within the product bank accounts, however you should regularly review this to ensure that there are sufficient funds available for investments, charges and withdrawals as required.
If insufficient cash is available to pay fees and charges, automated proportional disinvestment will take place where possible to help cover them. For income or withdrawals, you’ll be asked to specify which assets you’d like to use (this can be cash).