Millions of savers' are turning their backs on providers, keeping at least £5.2 billion at home 'under the mattress', according to a survey by the Financial Services Compensation Scheme (FSCS).
The compensation scheme, which protects savers' money up to the value of £85,000 in the event of their savings provider going bust, estimated that a large number of people are choosing to stash considerable amounts of cash in their homes.
Although the average amount saved at home has fallen to £196.80, from £217.92 this time last year, 2% of people confessed to storing more than £1,000 in their homes.
The findings suggest that many savers have lost faith in placing their hard-earned cash with a bank or building society, particularly following a series of scandals to rock the industry of late.
The mis-selling of payment protection insurance and the fixing of Libor rates, as well as record low savings rates and high inflation, have tested customers' loyalty and patience, resulting in higher numbers of people keeping their money at home.
Chief executive of the FSCS, Mark Neale, said: "In the unlikely event of a bank, building society or credit union failing, the vast majority of customers will get their money back within seven days.
"There really is no need to keep it under the bed."
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