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Savers switch for safety

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12/11/2007

Almost 50,000 people per day have transferred funds from their savings accounts since the Northern Rock crisis began on 14 September, according to moneyexpert.com
Research from the financial comparison site showed 1.7 million Britons have transferred funds from their savings accounts since Northern Rock was forced to approach the Bank of England for emergency funding in September. Most switchers cited risk as the main reason for moving their funds, moneyexpert.com found. Approximately 44 per cent wanted to divide their money among different financial institutions and 28 per cent switched to have no more than £35,000 per account – the amount per deposit guaranteed by the Government.

One in five people moved their savings to a high street bank, opting for well-known names for safety. But 72 per cent savers felt enough confidence in their bank to leave their accounts untouched, the research revealed.

Sean Gardner, chief executive of moneyexpert.com, said: “The queues outside branches may have gone but the concerns about a re-run remain and many are reacting by ensuring that their savings are not all in one basket. The fact that the Government guarantees £35,000 has hit home and savers are reacting accordingly.

“It’s interesting to see that despite increased competition having made such a huge impression on the banking landscape over the past 10 years, many people now appear to be giving a greater vote of confidence to the established, high street banks.”

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