Asda has unveiled a new workplace savings scheme exclusively available to its 150,000 employees.

The retailer has partnered with financial benefits provider Wagestream to offer a savings account that provides a competitive 4.7% annual equivalent rate, with full protection under the Financial Services Compensation Scheme.

The initiative is designed to provide more flexible savings options compared to high-street banks, which often require fixed deposits and charge fees for withdrawals.

In contrast, Asda employees will have the freedom to deposit and withdraw funds without any restrictions or penalties.

Flexible saving options

The savings account allows colleagues to save in two main ways. They can opt for a fixed sum to be deducted from their wages and directly deposited into the account.

Alternatively, employees can use the ‘rounding up’ feature, where shift payments are rounded to the nearest whole pound, and the difference is automatically added to their savings.

This scheme comes at a time when many UK savings accounts offer interest rates lower than the 2.02% national average for easy-access accounts, according to Bank of England data.

Asda aims to provide a more lucrative and accessible option for its workforce, helping employees to save without the restrictions often found in other accounts.

Saving versus spending trends

Asda's own Income Tracker, which monitors household disposable income, has highlighted a shift in consumer behaviour.

Despite a 14% rise in disposable income for the average UK household in the second quarter compared to the previous year, overall spending fell by 0.3%.

This suggests that more households are choosing to prioritise saving overspending.

The launch of this savings account aligns with these broader financial trends, encouraging Asda's employees to make the most of their disposable income.

With more than 36,000 employees having already downloaded the Wagestream app, the savings account is expected to become one of the most popular benefits available.

Asda already offers various financial support tools through its partnership with Wagestream, including retail discounts, money coaching, workplace loans, and flexible pay options.