11th-hour rush into new SSIS accounts

Up to 25,000 new Special Savings Incentive Scheme accounts have been opened each day since the beginning of the month in a last minute rush by savers to take advantage of the free €1 for every €4 saved on offer from the Government, according to industry sources. The scheme closes on April 30th but some financial institutions are closing their accounts earlier for administrative reasons.

While no figures for amounts invested so far this month are available, all financial institutions have reported a strong increase in the volume of business in recent weeks. Across the industry, about 100,000 accounts have been opened each week in April, according to Mr Hugh O'Keeffe of AIB. His bank has opened about 4,300 deposit accounts a day in April and about 500 equity accounts he said.

"In March, the number of accounts opened at AIB was up about 60 per cent on the February account numbers while, so far in April, it is up another 60 per cent on the March figures. There has been a big last minute rush to get into the accounts.

" Based on our account numbers and our market share I estimate that about 850,000 accounts have been opened so far and the number should reach about one million by the end of the month", he said.

Even at that level, the number of accounts would be well down on original expectations. Just after the scheme was announced, AIB carried out a survey in April 2001 which found that 72 per cent of the adult population between the ages of 20 and 54 years intended to open Special Savings Incentive Accounts (SSIA).

The latest figures indicate that just some 32 per cent of adults have opened accounts and that this could rise to 37 per cent.

Revenue figures for the inflows into SSIS accounts are available up to the end of February (the February figure is provisional). They show that a total of €519 million was lodged in SSIS accounts in the first 10 months of the scheme.

This amount is cumulative, including ongoing monthly savings by existing account holders as well as new accounts opened each month.

A breakdown shows that some €8.3 million went into new accounts in February. Industry estimates indicate a cumulative figure for new accounts and continuing savings of just over €101 million for March.

This indicates that the amount going into new accounts jumped to €15.5 million in March from the €8.3 million February figure.