By Gareth Vaughan
The Advertising Standards Authority has thrown out a complaint over a television advertisement for Kiwibank's ground breaking Notice Saver product, or no-term deposit, that features actor Sam Neill.
Launched last October and touted as the first no term deposit offered by a New Zealand bank, the Portfolio Investment Entity (PIE) compliant Notice Saver offers interest at 5.00% per annum and requires a minimum deposit of NZ$2,000. Savers can withdraw some, or all, of their money by giving Kiwibank 32 days notice. Kiwibank CEO Paul Brock told interest.co.nz in late November that Notice Saver had attracted "several hundred million dollars" from savers with much of the money coming from other banks.
The advert features a Kiwibank car with big chains wrapped around it. A voice-over says: “For too long New Zealanders have been shackled by term deposits that are harder to get out of than a muddy paddock and loose gumboots. And savings accounts that pay, well, peanuts. Well not any longer..”.
As the chains around the car break away, the voice over continues: "Announcing a Kiwi first. Kiwibank Notice Saver. Unlike other banks you can get higher returns on your savings without them being locked away. To access some or all of your money just give us notice. We reckon it’s worth moving banks for, especially the one you already own.”
On screen text reads: “32 days notice. Maximum investment NZ$2,000.”
The complainant, a J. Randall, said: “I may be wrong, but feel that the current advertisement for a savings account offering a high rate of interest with the person talking emphasising that 'your money is not locked in like other high interest accounts, and that you only need to give them some notice to get your money out,' is contradictory as people need to read the statement at the bottom of the ad that tells them they need to give 32 days notice to withdraw."
Randall argued that surely that means a customer's money is locked in for at least 32 days. The complaint was made under Basic Principles 2 and 3 of the Code for Financial Advertising.
The Advertising Standards Authority said Kiwibank was entitled to impose certain terms and conditions around the offer so long as the bank didn't significantly diminish the offer's value.
"The purpose of the advertisement was to promote the idea that the consumer was not 'locked in' if they signed up to the product on offer," the Advertising Standards Authority said.
The 32 day notice period was "a reasonable condition" to impose on the consumer and was clearly stated in the advertisement for people to read.
Therefore the advert was deemed to not have breached the Code for Financial Advertising and the complaint was dismissed. See the full complaint here.
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