HSBC is offering to refund 25% of the interest paid on their personal loans to borrowers who repay their loan on time as an incentive for responsible borrowing, according to the bank.
The refund means that customers who repay on time can get a GBP10,000 loan – normally charged at 6.9% for homeowners – for the equivalent of 5.3%. The offer is available to both new and existing HSBC customers.
Joe Garner, head of UK personal financial services at HSBC, said: This isn’t just about rewarding loyalty and responsibility. When a bank sets its interest rates a part of that calculation takes into account the possibility that customers might miss repayments.
If a customer is conscientious enough to meet all their repayments in full until their agreed completion date, then we should recognize that and give something back.