December 2015 – The Financial Conduct Authority has published a ‘name-and-shame’ list of banks and building societies offering very low interest rates, with some giving savers returns of just 0.01% (1 penny per year on £10,000) and highlights the way that savings accounts interest rates have been cut. A similar list will be published every six months.
The report shows that the Progressive Building Society pays 0.01% on easy access accounts and “Your” Nationwide Building Society has one of the worst in-branch easy access accounts at 0.25%. This is the society where the chief executive received yet another massive banker’s pay increase of 27%. Now we know why.
The FCA has also announced new measures to force banks and building societies to provide clearer information on interest rates. From December 2016, providers must tell consumers when interest rates change, and when introductory offers expire. Other measures include:
- key information must be displayed in a summary box, and shown to the consumer at the point of sale
- interest rates to be displayed ‘prominently’ alongside the account balance
- banks and building societies must provide a ‘prompt and efficient’ switching service to other accounts.
The requirements for notifying members of interest rate cuts was more stringent when the Banking Code and the Office of Fair Trading existed, but they were disbanded to the delight of bank and building society directors.