Savers doubtful of benefiting from base rate rise

by Gill Montia

Story link: Savers doubtful of benefiting from base rate rise

According to research undertaken by Tesco Savings, millions of UK savers are experiencing a decline in confidence as a result of recent interest rate rises not having been passed on to savers.

Of those questioned in the Tesco survey, less than 30% reported an increase in rates on their savings accounts since the Bank of England put up the base rate in May and consequently many were doubtful that the latest increase to 5.75% would be passed on.

Only 33% were optimistic that July’s base rate rise would have an impact on their savings accounts.

At the same time, almost half of all instant access savers taking part in the survey were not sure of the rate applied by their savings provider.

The results of the survey were no surprise to Jeremy Sutton, head of Tesco Savings. He believes that savers have begun to lose faith over the past few months because the number of providers to pass on full base rate increases has been steadily dwindling.

Some savers are certainly suffering from a degree of lethargy that could be attributed to the problem; a recent report by Sainsbury’s Bank highlighted the fact that UK savers are missing out on billions of pounds worth of interest by failing to put their money into the most advantageous accounts.