One of Britain’s largest banks is set to make a significant change to one of its savings products today (February 24). HSBC has confirmed it will slash interest rates on its easy-access Premier Savings for those whose balance doesn’t meet a certain threshold. All balances below £50,000 will see their rates drop from 1.98% to 1.74%.
Customers will also be hit by a further rate drop in just a couple of months, according to a report from The Sun. In April, interest rates are expected to drop once again to 1.49%.
Furthermore, the bank’s Flexible Saver account will see a rate drop from 1.49% to 1.37% from April 17. It’s important to note that HSBC’s Premier Savings options are only available to customers who qualify for its Premier banking services.
Generally, a customer will only qualify if they already have £50,000 in a HSBC account or have an annual income of at least £100,000. Easy access savers typically differ from other types of savings accounts by allowing customers to withdraw as much money as they want from the account with little to no penalty or fixed term.
Rachel Springall, finance expert at Moneyfactscompare.co.uk, said: “It’s so disheartening to see savings rates chopped in the last few days, but it just proves why savers are at the mercy of base rate cuts. Not even challenger banks have been able to escape making cuts as the market sentiment for lower interest rates has taken charge.”
She added: “Savers need to proactively keep on top of the best rates and review their pots regularly to see if they are getting a raw deal. Now is an ideal time for savers to consider grabbing a fixed rate deal so they can get a guaranteed return on their cash.”
It comes after HSBC launched new mortgage products with a low fixed rate. A 3.98% five-year fixed rate is being bundled with a £999 product fee.
However, this new product is only being made available to customers who are Premier banking customers. Furthermore, customers will need to either be first-time buyers or moving from one property to another.
The remortgaging rate is also higher than a lot of competing products at 3.99% alongside a qualifying criteria of the customer having at least 40% equity in their home.