Savers unaware of rate reductions

by Gill Montia

Story link: Savers unaware of rate reductions

Nationwide Building Society is calling on the providers of savings accounts to keep their customers better informed as to when introductory interest rate offers come to an end.

The building society believes that savers are being attracted by the high rates applied to some new accounts, which last for a limited period only.

It is suggesting that the Banking Code should make it mandatory for subscribing banks to inform consumers when the attractive starting-out interest rate changes.

Currently, many savings providers are offering high headline rates, which typically last for between 6 and 12 months.

These can offer up to 1% more than the rate of interest applied once the special offer expires.

At this point, many account holders will be unaware that their savings no longer benefits from the headline rate, because they will have forgotten about the change.

Nationwide would like to see savings providers contacting their customers a few weeks prior to an introductory interest rate coming to an end, giving them full details of new rate they will receive.