Experts are urging Brits to take action, saying savers are being “losing out” on interest rates offered by banks' easy-access accounts.
Following recent action from the Bank of England, interest rates on savings accounts have been increased.
The central bank's Monetary Policy Committee (MPC) raised the base interest rate to 5.25% to combat inflation.
One benefit of this is that savings rates have risen significantly in recent years.
However, new analysis from MoneyFacts has found that the average closed easy access rate over the past two years is lower than the actual easy access rate.
The difference between the average closing rate and live rate for easy-access accounts widened from 0.08% in July 2022 to 0.31% in July 2024.
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Savers are looking for the best terms from banks and building societies to make their money go further.
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Here's a full list of savings rates currently being offered by the major high street banks:
Barclays Bank – Everyday Saver – Interest rate 1.65 per cent, HSBC – Flexible Saver – Interest rate 1.98 per cent, Lloyds Bank – Easy Saver – Interest rate 1.40 per cent, NatWest – Flexible Saver – Interest rate 1.74 per cent, Santander – Easy Access Saver – Interest rate 1.70 per cent.
The Financial Conduct Authority's (FCA) rules for open market products and services came into effect in July 2023.
By comparison, the tax on closed products and services took effect on July 31, 2024, and includes easy-access savings accounts that are no longer sold to new customers.
These rules are enacted to ensure better consumer protection for customers across the financial services sector.
A recent survey by Moneyhub found that 36% of respondents believe that the consumer obligation will “make banks more customer-centric institutions”.
UK interest rates have risen after the Bank of England recently raised its base rate for the 14th time in a row. GB News
Rachel Springall, financial expert at Moneyfactscompare, explained: “Saver's stand to lose out if they don't proactively review and switch their closed easy-access accounts.”
“Over the past two years, despite base rate increases by the Bank of England and numerous calls for the major banks to increase savings rates for existing customers, the average interest rate on live easy access accounts has exceeded the average closed rate. Savers must shed their complacency in trying to move their savings or risk disappointment as their loyalty goes unrewarded.”
“Some of the big box banks have interest rates below 2% on their most flexible live easy access accounts, but across the market, even the highest-interest banks are offering rates around 5%.”
“Despite using a trusted brand, the convenience of parking their cash in an easily accessible account can mean missing out on other higher interest rates, so it's essential that savers move away from it and switch to a higher yielding account. Building societies and challenger banks continue to work hard to attract new savers and reward loyal customers, so it's worth comparing them against the more familiar big brands.”