UK banks shortchanging savers with ‘measly’ rates, says Which?

theguardian.com:

UK banks are paying savers “measly” rates on their cash even as the Bank of England has taken its base interest rate to the highest level in more than a decade, according to a study from the consumer group Which?.

Consumers face rates as low as 0.1% for some instant access savings accounts, Which? found.

That appears particularly low when compared with the Bank of England’s key interest rate, which was set at 4.5% in May. This is the highest level for the central bank’s base rate since 2008, in the height of the global financial crisis.

Such a high interest rate at Threadneedle Street made the “measly rates” on offer to savers “unjustifiable”, Which? said.

Consumers may be better off switching from their high street bank in order to get the most attractive rates, it added.

“With millions of consumers still feeling the impact of an unrelenting cost of living crisis, it’s become even more important to get better returns on savings accounts,” said Jenny Ross, the editor of Which? money.

“Yet, our research shows that established high street banks are shortchanging customers by potentially hundreds of pounds a year.”

In February, bosses of some of the biggest high street banks were quizzed by MPs on the Treasury select committee about why rates on savings accounts were so low.

Last month the City watchdog, the Financial Conduct Authority, said it had also warned some banks it might make “onerous interventions” if they did not pass on higher interest rates to consumers’ savings accounts.

UK Finance, a banking lobby group, has challenged some of the criticism levied at banks, saying that there is more to the interest calculation for savings accounts than it might seem.

The Bank of England’s key interest rate is only one factor when