Paper policy puts parents off CTFs

12 July 2006
According to a recent survey commissioned by engage Mutual Assurance, almost one third (32.6 per cent) of parents said that they would be more likely to open a Child Trust Fund (CTF) if they were able to complete the process online.

The current system means parents must send off a voucher in order to open the savings account, which is discouraging many people from cashing in on the government-issued savings vouchers, it seems.

Over a third (35 per cent) of the 2.3 million vouchers that have been issued have still not been redeemed.

"A key aim of Child Trust Funds is to help busy parents to open an account as soon as possible and to encourage an early regular savings habit," said Karl Elliott, marketing director at engage.

"This means removing barriers and making the process as simple as possible," he argued, noting that if vouchers could somehow be replaced by virtual certificates or an internet-based system, uptake rates could be improved.

"We know from experience that customers often lose, damage or misplace CTF vouchers, leading to a delay in opening their accounts," Mr Elliott added.

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