Savings account providers cut interest rates by full amount

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Savings account providers cut interest rates by full amount

Tue 6th Jan 2009

More than three-quarters of savings account providers have cut their savings interest rates following the Bank of England's base rate cut last month, according to data published by Moneyfacts.co.uk.

The price comparison site said that "the majority" of those who had reduced their savings account rates had cut them in line with the full one per cent base rate cut, although in some cases they had been slashed further.

Moneyfacts.co.uk said that only ten savings account providers had not reduced their interest rates.

Michelle Slade, analyst at Moneyfacts.co.uk, said: "Moneyfacts.co.uk has been recording savings rates since 1988 and if base rate is cut further this week as predicted we are likely to see the average rate drop to the lowest level ever seen."

Recently Saga, which specialises in financial products for the over-50s, said that the current low interest rates are "eroding" many pensioners' incomes.

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