Savers urged to switch as challengers offer four times more interest

The research shows that as a result of historically low interest rates, combined with poor High Street offerings, the average UK savings pot, now £8,500, could earn just an average of £43 a year of annual interest.

The research also reveals that whilst saving is a habit for the UK, many are simply not engaging with their hard-earned money: nearly a third (32%) of UK adults with savings admitted they do not know the current rate of interest on their main savings account, while almost a fifth (17%) admit to having never checked the rate on their primary savings account.

Paul Whitlock, Director of Savings at Charter Savings Bank, said:

“High street banks are offering little more to the UK than a secure mattress for their savings, and with news that more than 400,000 NS&I savers will see interest rates on their Isas cut, it’s no surprise UK savers have themselves lost interest in their savings.

“The low interest rate environment over the last six years has opened up the opportunity for challenger banks – such as Charter Savings Bank, One Savings Bank, Aldermore and Shawbrook Bank – to offer the only viable alternative for savers’ money. Currently, challenger banks dominate the best buy tables and pay interest rates that top 2%. With this in mind, some savers could be earning more than four times as much interest as they currently do.

“Since Charter Savings Bank was launched in February, 32,000 savers have already deposited over £1.5 billion with us in just the first nine months of operation. Eligible deposits with these challenger banks are protected up to a total of £75,000 by the Financial Services Compensation Scheme, the UK's deposit protection scheme. More must be done to incentivise savers to seek the best possible return on their money, especially with the prospect of a base rate staying at a historic low well into 2017.”