Barclays has announced it will slash rates on two of its popular savings accounts this Thursday.
As the Bank of England cut the base rate last week, many banks and building societies are set to follow suit.
Barclay’s Everyday Saver account will see rates drop from 1.50 per cent to 1.25 per cent on balances up to £10,000.
Meanwhile, the Rainy Day Saver account will decrease from five per cent to 4.76 per cent for balances under £5,000.
Customers with balances above £5,000 in the Rainy Day Saver will earn just 1.15 per cent interest on their savings.
Barclays will be slashing rates on popular accounts
PA
The changes follow the Bank of England’s recent decision to cut interest rates from 4.75 per cent to 4.5 per cent.
The Rainy Day Saver account comes with specific requirements for customers to access its rates.
To qualify, customers must either pay £5 monthly for a Blue Rewards account.
Alternatively, they need to deposit at least £75,000 per year through Premier Banking.
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Alastair Douglas, TotallyMoney CEO, warns that money held in the Everyday Saver account will “essentially be losing value as the interest rate is lower than the rate of inflation.”
Douglas suggests customers should look beyond major banks for better returns on their savings.
He said: “When shopping around, it’s important to consider smaller and newer banks, as they’ll be more likely to be offering more competitive rates and better service to win your custom.”
Several providers are currently offering easy access savings accounts with rates exceeding four per cent.
These accounts allow customers to earn higher interest while maintaining the flexibility to make withdrawals as needed.
For those concerned about security when switching banks, Douglas offers reassurance about protection measures.
Under the Financial Services Compensation Scheme (FSCS), the first £85,000 of savings per regulated bank or financial institution is protected. This protection applies individually to each regulated provider a customer uses.
“Put simply, loyalty doesn’t pay — but moving banks can,” Douglas emphasises.
The message is clear for savers seeking better returns on their money: Shopping around could lead to more competitive rates.
With numerous smaller banks offering higher interest rates on savings, customers have options beyond traditional high street banks.