Skipton savings can now be linked to base rate

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Skipton savings can now be linked to base rate

Tue 23rd Nov 2004

Skipton Building Society has re-launched a savings account which will track the Bank of England base rate of borrowing.

Typically banks and building societies increase and decrease the rate of interest they pay investors roughly in line with the Bank's base rate - but there have been concerns expressed that while increases in base rate are swiftly passed on to mortgage holders, there is a lag before similar increases reach savers.

"Savers with Skipton's base rate tracker account can guarantee that their interest rate will follow any movement, up or down, ensuring they continue to receive a fair return," noted Jennifer Holloway, head of media relations.

Additionally, the Skipton points out that the gap between the rate it charges borrowers and pays savers is the lowest in the industry at 0.79 per cent.

The Skipton's third issue of their Base Rate Tracker promises a guaranteed link to base rate until June 30th, 2006 and currently offers to pay savers as much as 4.85 per cent.

Consumers can invest between £500 and £1,000,000 in the product - although to receive the highest interest rate consumers will need to invest more than £100,000. Those investing £500 will receive an interest rate of base rate minus 1.5 per cent (currently 3.25 per cent), but additional capital can be added at any time.

There is a monthly interest option, available at 0.25 per cent less than the standard tracker rate, for borrowers wanting more immediate returns.

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