Just 3 in every 10 accounts pay over 0.5pc

TWO months after the rise in general interest rates, savers are earning little or no extra.

The top easy-access accounts with banks and building societies pay no more than they did before the November rise, while those in average accounts have seen a minuscule increase.

It was hoped that the rise in base rate on November 2 from 0.25 pc to 0.5 pc would help beleaguered savers as providers passed on the increase.

But the average rate on easyaccess accounts in November crept up by only 0.06 percentage points to just 0.45 pc.

Depressing figures from data monitor Moneyfacts show the number of accounts paying above base rate dropped by a huge 150 in just one month. It is the largest drop its monthly Savings Treasury Report has recorded since February 2008.

Fewer than seven out of ten of all accounts pay more than the 0.5 pc base rate. It is the first time this figure has fallen below 70 pc for five years.

Back then, rates dropped sharply following the introduction of the Bank of England Funding for Lending Scheme, which let banks borrow from it at rock-bottom rates. The effect was that they no longer needed to woo savers, so cut their rates.

Finance expert at Moneyfacts Charlotte Nelson says: ‘ The figures prove many providers have failed to pass on the full rate rise on their accounts.’

And while the average rate has edged up a smidgeon, the top deals have not even managed that.

Tom Adams, head of research at independent savings advice site Savings Champion, says: ‘The best deals on easyaccess accounts are back down at the level they were before the base rate rise in November.’

In the week before the rise in base rate, the top easy- access accounts on sale to new savers paid 1.3 pc, research from Savings Champion shows. They included RCI Bank’s Freedom account at 1.3 pc and BM Internet Saver at 1.3 pc, followed by Bank of Cyprus UK’s online Easy Access account at 1.28 pc.

Some providers edged up their rates to pay slightly more than 1.3 pc in the following weeks.

Birmingham Midshires offered 1.45 pc to new savers, Charter Savings Bank 1.32 pc, Virgin Money 1.36 pc, Paragon Bank 1.31 pc and Tesco Bank 1.35 pc. However, these deals have now vanished. The top rate for new savers is back where it started: 1.3 pc from the RCI Bank Freedom account. The BM Internet rate for new savers has plunged to 0.55 pc for £ 1,000 and 0.9 pc at £ 25,000, while the Bank of Cyprus rate has edged down to 1.25 pc, Virgin Money to 1.26 pc and Tesco Bank to 1.2 pc. others’ top rates that have dropped include Skipton’s e Saver. It rose from 0.81 pc to 1.06 pc in December, but new savers are now being offered 0.9 pc, or just 0.09 percentage points more than before the base rate rise. Coventry BS’s Easy Access Saver 4, where the rate rose from 0.85 pc to 1.1 pc from the start of December, has been closed to new savers. Its replacement, Easy Access Saver 5, pays a lower 0.9 pc — just 0.05 points more.