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Savers warned not to rate chase

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Moneysupermarket has announced a bumper week for savers as both Abbey and Coventry Building Society launch market leading accounts.
Abbey’s new eSaver Direct has a rate of 6.4 per cent, having been just beaten to the top spot by Coventry’s 6.51% Online Saver. However, Kevin Mountford, head of savings at price comparison site Moneysupermarket, has warned savers to look beyond the headline rate.

“It has been a bumper week for savers, who now have two new market leading savings accounts to choose from,” he said.

“The new offerings from Abbey and Coventry technically sit in the easy access sector. This, by definition, should provide the saver with the option to deposit and withdraw on a regular basis. However, these two accounts have strict criteria where savers lose out if they withdraw cash. Coventry will only penalise on the amount withdrawn, rather than the whole balance, which gives it the edge over Abbey.”

Mountford added that such accounts target disciplined savers, so those who don’t trust themselves to leave their account alone should look at alternatives with no such penalties.

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