The government run Help to Save saving accounts provide low income people a tax-free savings option with bonus payments on deposits.
The accounts scheme was launched two years ago and promised savers fifty percent bonuses on the deposits they made into accounts, which considering high street banking rates on savings is quite an incentive.
People would deposit up to £50 a month, for a maximum of fours years, and receive a bonus payment at a two year period. The bonus payment is based on 50 percent of what the saver deposited in the preceding two year period.
The first batch of accounts were opened two years ago and thus are receiving their first bonus payments. An average of £378 has just been paid as a bonus meaning that the average savings paid in over the last two years was £756, or about £30 a month.
If savers had deposited the maximum £50 a month, the bonus this Christmas would be £600.
The government estimated the scheme would cost over £250 million by the time it closes at the end of 2020. So far savers have had bonuses worth around £23 million after two years.
A total of 60,410 accounts received bonuses, with the highest concentration being the North West of England, followed by Greater London.