You are here: Home - Saving & Banking - News -

Savings rates soaring

0
Written by:
12/09/2008

The average rates of interest paid out on savings accounts has rocketed in the past year, despite the Bank Base Rate falling. Analysis by moneysupermarket.com reveals that last September the best easy access account – Northern Rock’s online tracker – paid 6.31%, when the Base Rate was 5.75%. Today the best easy access savings account is from Alliance & Leicester and pays 6.56% – 1.56% higher than the Base Rate.
These generous rates are the result of banks’ desperation to claw in as much cash on deposit as they possible can, following the run on Northern Rock.

Kevin Mountford, head of savings at moneysupermarket.com, said: “It has been a turbulent year and there have been many people nursing losses from the stock market performance, but cash savers really have had the last laugh. While the base rate has been falling, the average rate on savings accounts has been steadily climbing as providers seek to shore up their books. As long as this demand for retail deposits remains high, savings rates will stay high – it’s that simple.
“What has been most interesting is how the best buy tables have changed – 12 months ago, UK banks tended to dominate the top five whereas now we’re seeing foreign banks really flexing their muscles. In particular, we’ve seen strong offerings from the likes of Kaupthing and ICICI, which has led to a rate war. This increased competition means some UK institutions will need to start making bolder moves for our deposits.”

Tagged:

Tag Box

Debt

Pension

Spending

Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Protection ploughs as people feel pinch

Almost half the population plans to cut corners on financial products as their incomes are squeezed by the rising cost...

Close