We have temporarily withdrawn certain savings accounts in order to protect our customers from rate reductions
We have taken the unusual step of withdrawing many of our savings products from the market in order to delay reducing the interest rates paid to existing account holders.
The Society’s accounts became extremely attractive nationally as a result of recent declines in savings rates caused by the introduction of the Bank of England’s ‘Funding for Lending’ scheme. This scheme, created to help boost the flagging economy, has allowed many high street lenders to access very cheap funding from the central bank. As a result these lenders no longer need to attract savers in order to fund the money they lend out, leading to a significant drop in the rates paid.
Ian Keeling, our Head of Sales & Marketing said: “The market reduction in savings rates meant that our already competitive rates became best buys and we consequently attracted large inflows of savers’ money to the Society. In order to ensure our growth is balanced and sustainable we needed to curb this inflow and rather than taking the ‘normal’ course of action and cutting our rates, we have instead chosen to temporarily close several new accounts to new customers.
Savers have been particularly hard hit since the financial crisis began and by taking this action we ensure that for now, any reduction in rates is delayed. Unfortunately the cost of doing this means that we will have to make some rate cuts in the coming weeks but we still expect our accounts to remain above current market averages.”