£10k in the bank earns you just £1
SAVERS face yet more misery after average rates plummeted to their lowest on record, figures reveal.
A typical easy access account now pays just 0.19 per cent – a third of what it did a year ago.
And all high street banking giants, including Barclays, Lloyds, Nat West and HSBC, pay even less at 0.01 per cent or just £1 on a £10,000 deposit.
Fixed rates have also dived, with the average one-year deal paying less than half what was on offer in December 2019.
Savers have struggled to find a decent interest rate for their nest eggs since the 2008 financial crisis.
But rates crashed to new lows this year after the Bank of England cut base rate to 0.1 per cent in March and in November the Government’s savings arm, NS&I, cut its rates to as low as 0.01 per cent.
It means families who have built up £100billion of extra cash in lockdown now face the lowest rates across all types of deal since 2007, say analysts Moneyfacts, whose records go back to that year.
The choice of products has also shrunk. There are now 1,514 savings deals, including Isas, on the market – 312 fewer than a year ago.
The average easy-access rate has fallen from 0.6 per cent in December 2019 to 0.19 per cent – £19 on a £10,000 sum. In December 2011 the average easy-access account paid 0.94 per cent – or £94 on £10,000.
The average tax-free cash Isa rate has fallen from 0.87 per cent in December last year to 0.27 per cent.
And a typical one-year deal now pays 0.54 per cent, down from 1.23 per cent over the same period.
Rachel Springhall of Moneyfacts, said: ‘Providers have had to react to an extremely volatile market this year and deals have been cut multiple times in a short space of time in some cases, or withdrawn entirely.’