Major bank cuts its savings rate to near 1% - here's where you should move your cash to
Banks have rushed to cut savings accounts in the wake of the Bank of England cutting the base rate to 4.25 per cent last week.
In the days following the Bank of England's base rate decision, at least 59 savings accounts had their rates slashed or withdrawn This is Money analysis found, including Monzo, Chase, Chip and Plum.
Savers who keep money in a NatWest flexible easy-access account will soon be on the receiving end of a cut to their savings rate too.
The banking giant is slashing the rate it pays on its flexible easy-access account to 1.15 per cent from 1.25 per cent from 30 May.
This is the rate paid on balances up to £24,999. Customers can earn up to 2.7 per cent depending on the amount kept in the account.
The average easy-access account rate is 2.75 per cent according to rates scrutineers Moneyfacts Compare.
A rate of 1.25 was already paltry, but savers will now be earning little over 1 per cent on easy-access savings.
NatWest will cut the rate paid on its flexible saver to 1.15% from 1.25%
It means that for every £100 kept in this account, a saver would earn just £1.15. On a deposit of £1,000 a saver would earn £11.50 in interest.
If they were to keep this sum in the best easy-access account, currently offered by Atom Bank and paying 4.75 per cent, they would earn £47.50 on each £1,000.
The next best deal is from West Bromwich and pays 4.65 per cent. There are six easy-access deals currently offering 4.5 per cent, This is Money's best buy easy-access tables show, so savers should not have to put up with dud rates.
NatWest is not alone in offering low flexible easy-access rates.
Lloyds Bank pays an even worse 1.05 per cent on its easy saver on balances up to £24,000.
Savers earn just £1.05 per cent interest for every £100 in the account.
Santander's easy-access saver pays 1.2 per cent, Barclay's everyday saver pays 1.5 per cent while HSBC's flexible saver pays 1.74 per cent.
On a balance of £10,000 these banks pay an average interest rate of just 1.42 per cent.
Caitlyn Eastell, of rates scrutineer Moneyfacts Compare says: 'After the recent Bank of England base rate cut many providers have been rushing to re-price their offerings, which has ramped up the competition, but challenger banks continue to dominate the market-leading positions.
A spokesman for NatWest says: 'Following the Bank of England base rate cut, we have made reductions to some of our variable rate savings accounts.
'We will communicate these changes to customers in due course, giving at least 14 days’ notice of any changes.
'Details of these changes are available on our website now.'
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