Savers give up on interest rates

by Gill Montia

Story link: Savers give up on interest rates

Recent research from uSwitch indicates the extent to which UK savers have lost track of interest rates.

According to the price comparison website, 22 million savers may not have kept up with falling returns prompted by the Bank of England’s reductions in the base rate.

From a poll of 2,750 people, 51.6% were unaware of the interest rate on their main savings account.

The base rate has been cut six times since October of last year and is now down to a record low 0.5%, with a further review due this week.

uSwitch’s head of personal finance, Rumina Hassam, comments: “What is concerning is the sheer number of savers who have become so despondent by the effects of the base rate cuts that they have absolutely no idea about what level of interest they are earning.”

Ms Hassam warns that demoralised savers play into the hands of providers who are more than happy to keep deposits in accounts with low returns.

The research also indicates that 2.6 million savers believe providers should keep their customers updated with interest rate cuts, although one-quarter of respondents recognised the need to do their homework and had actually switched for a better rate during last year.