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

Union Bank of India cuts top interest rate days after launch

0
Written by:
12/08/2022
The Union Bank of India has cut the interest rate offered on its market-leading one-year fixed term product, just days after launching.

The bank, which has largely been operating under the radar of savers, this week launched a market-leading one-year fixed rate savings product offering 3.2% AER.

This was some way above the top-payer at the time – OakNorth Bank’s 2.86% AER – with experts questioning why it had jumped so far ahead, while savers were unsure whether their money was safe. See YourMoney.com’s One-year bond pays 3.2%: Is your money safe with Union Bank of India? for more information.

Either way, there were warning signs yesterday that Union Bank of India (UK) was planning to change rates, with the consensus that they were likely to come down, rather than go up.

A message on its website yesterday afternoon, read: “Please Note ** ‘Dear Valued Customer, we are currently reviewing Interest Rates offered on all our Deposit products. New rates will be applicable with effect from tomorrow 12/08/2022 @ 00.01 AM. We request you to kindly check and reconfirm the rates before submitting your application’.”

And here’s what’s changed today:

  • One-year: Cut from 3.2% to 2.85%
  • Two-year: Cut from 3.3% to 3.2%
  • Three-year: Remains at 3.3%
  • Four-year: Cut from 3.35% to 3.30%
  • Five-year: Cut from 3.4% to 3.35%

‘Too far ahead of competition’

James Blower, founder of The Savings Guru, said: “It’s no surprise that Union Bank of India have pulled back this morning. Their short-term fixed rates were too far ahead of the competition and they were inundated with savers.

“I expect they’ve had to drop because of the amount of customer and operational contacts they were seeing to. On one-year, which they were most competitive on, we’ve seen Gatehouse Bank and Ford Money increase to 2.95% to take top spot this morning.  These moves do highlight how quickly savers have to move if they want to get the best deals with Union Bank’s rates lasting less than a week.”

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.

Seven ways to get help with energy bills this winter

We knew today’s announcement was going to be painful, but it’s still a shock to the system. When this kick...

Flight cancelled or delayed? Your rights explained

With no sign of the problems in UK aviation easing over the peak summer period, many will worry whether holida...

Rail strikes: Your travel and refund rights

Thousands of railway workers will strike across three days this week, grinding much of the transport system to...

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.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week