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Number of savings accounts with bonuses rising

Number of savings accounts with bonuses rising

Category: Savings

Updated: 27/11/2009
First Published: 26/11/2009

MONEYFACTS ARCHIVE
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Accounts that include a bonus currently make up a greater proportion of the savings market than ever before, figures from Moneyfacts.co.uk have found.

In the last two years, the percentage of accounts including an introductory bonus in the variable rate market has increased significantly, increasing from 12.7 per cent to 19.8 per cent.

The proportion of savings accounts has risen for three months in succession and now accounts for 7.93 per cent of the entire savings market (including fixed rate accounts) – the highest figure seen since records began.

In addition, the size of the average bonus has more than doubled in the last two years, from 0.61 per cent to 1.26 per cent.

In the wake of the credit crisis, the Treasury announced new legislation requiring providers to hold increased levels of savers' deposits. This increased demand for savers money has resulted in provider large and small upping the rates they offer savers," said Michelle Slade, spokesperson for Moneyfacts.co.uk

"Providers are increasingly using short term bonuses to temporarily boost the rate. In many instances the bonus now makes up the largest part of the rate - up to 85 per cent in some instances.

"Providers do not need to advise savers when a bonus ends, so savers need to ensure that they remember to review their rate at the end of the bonus period. Otherwise the benefits of the bonus will be eradicated by remaining in an account which is no longer competitive."

Find the best savings accounts for you - Compare introductory bonus accounts

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

 
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