Banks start to cut savings account rates
December 30, 2007
Earlier this month the Bank of England cut the base rate by 0.25% from 5.75% to 5.5% in a move that was welcomed by many industry officials and borrowers. However, the news is not so good for savers, who are now being hit with interest rate cuts on their savings. According to a recent report a number of banks have already cut the interest rate on savings accounts, and in a double whammy some banks may cut interest rates on savings twice with savers being hit with a 0.5% cut in the space of one month.
Some banks had already cut their savings interest rates just days prior to the Bank of England announcing the base rate cut, and therefore savers could see the interest rate cut once again. In addition to this another base rate cut has been widely predicted for early next year from the Bank of England, and this means that savers could be hit with yet another rate cut in a very short space of time.
Savers are being urged to keep their eye on their savings account interest rates, and wherever possible to start looking around for an alternative savings account if the interest rate on their existing savings account is slashed. A number of banks have already slashed their savings interest rates, and amongst those that have slashed their rates are Abbey, Barclays Halifax, Lloyds TSB, NatWest and RBS.
Customer are not automatically informed if savings interest rate cuts are applied up to a certain level, and this means that you may need to keep your eye on your savings account interest rate to monitor any interest rate movement. Those wishing to switch to a more lucrative savings account will be able to easily compare accounts by using the Internet.
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