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Hargreaves Lansdown mops up NS&I savers as rates set to be slashed

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NS&I customers have flocked to investment platform Hargreaves Lansdown’s cash savings hub after the government-backed arm announced severe rate cuts taking effect next month.

Hargreaves Lansdown’s trading update for the three months to 30 September revealed it’s Active Savings hub had been hampered by the market-leading rates offered by NS&I.

The government’s savings arms had ridden at the top of the best buy tables in three separate categories, including in the easy access range for months.

But last month, NS&I announced interest rates on several savings accounts would be slashed to a paltry 0.01% in November, while Premium Bonds holders would also have less chance of winning later in the year.

Following the announcement, it seems NS&I’s loss is Hargreaves Lansdown’s gain as it noted since the rate cut news, it has seen “a marked impact on flows back into Active Savings”.

Currently, the top rate offered to customers is 0.96% AER on easy access savings from Coventry Building Society’s Limited Access account.

The trading update stated that positive market movement of £2.1bn, combined with net new business has driven assets under administration to £106.9bn. this is up 3% since 30 June 2020.

It also took on an extra 31,000 customers in the period, taking active client numbers to 1.44 million.

Chris Hill, chief executive officer, said: “We report a good start to our financial year, with growth in clients, assets and revenue. These results are against the ongoing backdrop of market uncertainty and highlight the resilience of our business model and client proposition.

“We are confident that the strategy we have invested in, with our focus on the needs of UK investors and savers and delivering the highest level of client service, means that we continue to be well positioned to deliver continued attractive long-term growth.”

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