Notification of interest rate changes from banks

theGrinch wrote: »

if you have a 30, 60, 90, 120 or 180-day notice account then banks should give you identical notice of any change to interest rates. not sure they have to at present. fair is fair.

How many people actually have notice accounts these days?

rb10 wrote: »

Until Lloyds stepped in, Halifax always used to offer good rates, and give them to you on every online banking screen (for the vast majority of accounts).

They did, although in 2007-2009 you do wonder how much of that was desperation as the business went down the pan. Is a steady but unexciting rate better than the possible stress of an FSCS claim?

I suspect the HBOS brands are suffering a bit from the higher rates offered over the last couple of years. I suspect that they attracted a large number of unprofitable rate tarts that they'd quite like to shake off. This would probably explain the less exciting rates currently on offer.

relwofnai wrote: »

I understand that banks etc have a legal obligation to notify customers of any changes to interest rate changes and accept that they satisfy this obligation. However I feel very strongly that they manner in which they do is unsatisfactory and certainly not customer friendly.

When interest rates change I receive a bog-standard letter with a leaflet detailling the current interest rate changes for every single savings account, including closed accounts. The leaflet usually runs to several pages and both lacks clarity and creates confusion. It also makes it too dificult to determine how much interest you are receiving on your savings.

Look, they are bothering to tell you all the rates that they have. What more could you ask than the opportunity to check what you're getting and what you could be getting in the same communication?

I feel very strongly that this contributes to savers failing to shop around for the best rates.

No. Laziness and lack of interest are the main contributor. Best buy tables appear in newspapers, on web sites etc. It's nothing to do with the communications sent out (or not sent out) by banks.

I am equally certain that banks etc are aware of this and are at best reluctant to do anything to make the information more customer specific and at worst happy to exploit this ploy to deter savers from achieving the best return on their savings.

Go to the bank's web site. Go to the branch. Ring them up. Ask the question "what rate could I be getting?". It's not hard if the consumer actually gives a to$$.

This came to the fore just before Easter when I was in my local branch of Abbey (now Santander). I had an appointment to see someone about the paltry 0.1% interest Santander were paying on an old ISA, and while I was waiting to be seen I also overheard another couplw who were astounded to discover they had received only 12 pounds on their ISA which held 12 thousand pounds. They left the premises in a state of shock and absolute disbelief.

Did none of you hear the news stories about BofE rates dropping from 5.5% to 0.5% and think to act sooner? Really, a vague awareness of the world could have avoided the situation.

In the hi-tech 21st century banks should be able to send customer-specific letters which provide clear and concise information on the customers holdings.

It all costs money though. More than "bog-standard" costs. I don't want to have to receive a poorer rate because it's been reduced to cover the cost of a fancy mailing that 90% of customers will throw away.

Similarly banks should be able to provide account-specific information about relevant interest rates for on-line accounts.

Agreed.

This would make the information more accessible, relevant and customer friendly. Also it would encourage savers to achieve the best return on their savings and discourage banks from exploiting the apathy of quite a high proportion of savers (admittedly including myself in this instance) and increase competition between banks.

Good letter, bad letter, no letter. Whatever the choice, the apathetic will still significantly outwieght the pro-active.

I wonder if people feel this is worthy of a campaign of some sort, perhaps including a standard letter that subscribers to this website could use to support the campaign

I don't see the point. I beleive from 1st May banks will have to write to customers to tell them if they are dropping off a bonus rate on to an underlying rate for an account.

The eventual result of this will be a reduction in the number of accounts offering a bonus rate. As a pro-active individual who looks after his own savings, instead of expecting to be spoon fed by a profit making bank, this will probably mean I get lower returns.