Concerned consumers are not being deterred by the paucity of savings rates currently on offer and are saving more than they were a year ago, new data from the high street's banks has revealed.
According to the British Bankers' Association (BBA), personal deposits rose by 5.5% over the year to April, even though interest rates on most accounts remain historically low.
At the same time, demand for credit has slowed as consumers rein in their spending, with the outstanding level of unsecured borrowing contracting by 1.3% over the last year.
Although there was annual growth in credit card borrowing of 5.8%, this was masked by a 6.7% contraction in personal loans and overdrafts.
"Low consumer confidence is depressing demand for new borrowing and consumers are continuing to save, with deposits rising by 5.5% over the year to April," said David Dooks, BBA statistics director.
Following the latest inflation announcement, Moneyfacts.co.uk revealed only one 'non-ISA' savings account offers a rate that negates the impact of basic tax and inflation, while just six cash ISAs can beat inflation.
"The pound in the savings account is still being savaged by stagnant returns and above-target inflation," said Sylvia Waycot, Editor at Moneyfacts.co.uk.
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