Rate cull narrows choice for savers - Savings - News - Moneyfacts


Rate cull narrows choice for savers

Rate cull narrows choice for savers

Category: Savings

Updated: 16/11/2012
First Published: 14/11/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The nights are drawing in and the temperature is dropping, signalling the dawn of winter, although over past weeks, it seems that it's not just the barometer that has been dropping.

A surge of rate reductions have swept through the savings market, with over one hundred savings accounts having their rates slashed by over forty providers.

Reduced choice in the savings market couldn't have come at a worse time for savers who have struggled to achieve decent returns on their hard-earned savings.

Inflation is on the rise yet again, with the Consumer Prices Index increasing from 2.2% to 2.7%, squeezing household incomes even tighter.

A basic rate taxpayer will need to find an account paying a rate of 3.37% to beat the effects of inflation. Quite a tall order when just forty accounts, three of which are non-ISAs, offer rates at 3.37% or above.

Charlotte Nelson, finance expert at Moneyfacts.co.uk, said: "After a brief spell of falling inflation, savers now have to face up to the reality of it rising yet again.

"Savings rates are continuing to fall, so investors face a real struggle to generate any sort of real return.

"Best buy savings deals are being pulled left, right and centre so it is imperative for savers to act fast to take up the best rates, before the market evens out."

Here are just a few of the online savings accounts to have incurred rate cuts over the past month:

Provider Product Details

ING Direct
Direct Savings Account

  • 6.11.12. Rate reduced by 0.50% to 1.98%.

Nationwide Building Society
MySave Online Plus

  • 16.11.12. Rate dropped to 2.18% (2.20% AER).


Building Society

  • 16.11.12. Decrease of 0.30% bringing the rate down to 2.20%.

Tesco Bank
Internet Saver

  • 18.10.12. Rate slashed by 0.20% to 2.40%.

Mowbray Building Society
Online Easy Save

  • 13.11.12. Rate reduced by 0.20% to 2.20%.

Royal Bank of Scotland
Fixed Rate Bond: Internet Only Edition
  • 13.11.12. Rate dropped by 0.20% to 2.30%.

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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 Any products featured may be withdrawn by their provider or changed at any time.

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