KBC throws gauntlet to rivals by cutting interest rates on personal loans for some
Expanding KBC Bank is cutting its personal loan rates for those who make repayments from their current account.
The bank is also introducing a new cash-back scheme on its credit card, as it attempts to get customers to move to it from AIB, Bank of Ireland and Ulster Bank.
Customers who take out a loan with KBC and pay it off through their current account with the bank will get a 2pc discount on the rate.
To be launched in days, the new loan rates will be among the lowest in the market, putting pressure on rivals to cut their rates.
Personal loan rates here are high compared with other eurozone countries, Central Bank studies have found.
For a loan of €20,000 over five years, KBC will charge 10pc for those who can avail of the 2pc discount.
This is the same as the interest rate charged by AIB, but lower than the 12.8pc charged by Bank of Ireland, according to information on the National Consumer Agency's website.
The new KBC loan rates are fixed, but there is no charge for repaying the loan early if they amount repaid is less than €10,000.
Customers of the bank already get a 0.2pc discount on a mortgage taken out with KBC if they have their salary paid into its current account, and get an extra 1pc on a savings account. The bank is also introducing a new 1pc reward scheme for grocery and online purchases on its new credit card.
The maximum reward is €10 a month on the card, which can be used for small purchases without entering a personal identification number.
The card has an interest rate of 14pc for purchases, and there can be four cards on the one account.
The Belgian-owned bank aims for most customers to do their banking online, but also has nine 'hubs', with plans for six more next year.
This year hubs are opening at Grand Canal Plaza, Swords and Stillorgan in Dublin and Maynooth in Kildare.
'We we now offer a full suite of consumer finance products to meet consumers day-to-day financing needs,' said the bank's head of consumer finance Rob Hurley, pictured.
KBC Bank has recently brought out a new one-year fixed rate aimed at first-time buyers.
The 3.5pc rate is 1pc lower than the average variable rate in the market.
The bank is offering to cut this lending rate, and others, by 0.2pc for those who set up a current account with it.
It is snapping up mortgage market share by offering to pay one year's free home insurance to all new mortgage customers.
The bank claims it is approving eight out of 10 mortgage applications.
And it recently put in place a 'quick approvals' process for borrowers.
Irish Independent
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