Savers befuddled by interest rate cuts

Savers befuddled by interest rate cuts

Over half of UK savers have no idea what interest rate their savings account is paying, according to new research by uSwitch.com.

The price comparison site found that 22 million savers are clueless as to how much their interest has been reduced since the Bank of England’s base rate started falling six months ago.

Meanwhile, sixteen percent of those polled said the Bank of England’s rate cuts are so depressing that they have become apathetic about how much interest they are earning.

“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,” said Rumina Hassam, personal finance expert at uSwitch.com.

“Whilst this consumer sentiment is understandable, this kind of apathy will play into providers’ hands.

“If savers don’t vote with their feet and move their money away from poor performing accounts, providers will just carry on as they are.”

Many savers believe their banks should provide more information on how interest rates have changed, with 2.6 million savers blaming their account provider for leaving them in the dark on interest rate cuts.

Hassam commented: “Savings providers’ are duty bound to let their customers know whenever the interest rate on their savings account changes.

“However, this report indicates that providers may not be doing enough to let their customers know in a clear and transparent way when their interest rates change and for what reason.”

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