Banks Deploy Tactics to Persuade Savers From Dipping into Savings

By: MoneyFacts

With rates at record lows, savers are seeing little reward. Research, conducted by Moneyfacts, has seen a rise in the number of accounts designed to deter savers from the temptation of dipping into funds for frivolous purchases, particularly during the mid season sales.

This month Bank of Scotland, Coventry BS, Halifax, Lloyds TSB, NatWest, Royal Bank of Scotland and West Bromwich Building Society all launched accounts, which restrict how many withdrawals the saver can make. If the permitted number of withdrawals is exceeded, the saver will incur a drop in the rate of interest.

Lloyds TSB Incentive Saver, which is a 12 month fixed term variable rate account, pays a rate of 3.00% monthly from £1. However, for each month where there is a withdrawal, interest will be lost on the full balance for that month.

West Bromwich Building Society’s Branch Easy Access Saver and No Notice Saver Direct deals offer rates of 2.85% and 2.80% respectively. Withdrawals are limited to 2 and 3 per year without penalty.

Halifax’s Guaranteed Saver Reward pays a guaranteed rate of 2.60%, and includes a bonus of 2.10%, for twelve months. Savers with a qualifying current account from £2.5K will receive a higher rate of 2.80%. Four withdrawals are permitted during the 12 months reward period.

Samantha Owens, Principal Consultant - Banking and Economic Insight, commented: “Customers should consider carefully whether the funds are needed. If they really wish to save and can limit their withdrawals there are many new options on the market. Whilst many of these accounts are lower than the current competitive fixed rate market, these accounts have the option of allowing further additions and notice does not necessarily need to be given, although sometimes at a penalty, which should give the consumer peace of mind should the funds be required or if a more competitive deal appears on the market”.

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