Post Office 'passes on' base rate increases to customers

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Post Office 'passes on' base rate increases to customers

Fri 11th May 2007

Customers are being encouraged to maximise their financial potential by seeking out the most competitive savings vehicles on the market.

The Post Office believes that many consumers who have accounts with some of the biggest banks and building societies on the high street are missing out from the full one per cent rise in the base rate in the last year.

The group is urging savvy consumers to start up a Post Office saving account, with the group yesterday announcing that its instant saver rate would increase to 5.75 per cent from June 4th 2007.

The Post Office has also committed to passing on base rate increases to customers in full until January 2010.

It estimates that a consumer holding a typical high street savings account containing £5,000 would lose approximately £145 in interest payments in the first year compared to the Post Office account.

Head of savings at the Post Office, Richard Norman, said: "It's easy to become a base rate loser when account providers fail to pass on interest rate rises in full to their customers, leaving people hugely out of pocket.

"Interest rates have risen sharply over the last year and many experts believe there are further hikes to come. As people tighten their belts due to rising mortgage payments, they should make sure any money they have in savings is working as hard as it can for them," he added.

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