Rubbish savings rates

Adyinvestment

dosh37 said:

I asked a simple question. Why?

Well, to put it simply...they don't have to.

Banks are business that exist to make a profit, and at the moment they don't want/need your money enough to tempt you with higher rates.

Ocelot

dosh37 said:

wmb194 said:

dosh37 said:

wmb194 said:

If you compare the Swanlow Park data with the Bank Rate's history it looks like, for instant access, it's sometimes above and sometimes below. The Swanlow Park data isn't necessarily indicating the the best available rates, though.

You can put these data together to make a chart if you're really interested.

https://www.swanlowpark.co.uk/savings-interest-data

https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp

hmm - the Swanlow Parks links give a Firefox security risk. Not exactly confidence inspiring.

I'm not really surprised by the quality of responses on MSE.

It's fine for me on my iPad. The truth is, it's seems you're in a bad mood and don't want to hear any answers. 

You still haven't clarified what you're really asking: actually only interested instant access rates?

I thought my originall question was clear enough.

In the past savings interest rates were always above the BoE rate. That is no longer the case.

I asked a simple question. Why?

I was bombarded with responses that seemed to suggest I am an idiot for asking why. Maybe I am an idiot but I would still like to know the answer.

I think the answer is that big banks have other ways of getting money nowadays, so many don't offer anything other than token rates, since they don't really need your money.

Also, with the amount of money a bank has to hold in cash in reserve being effectively abolished (or certainly very low), they need even less 'concrete' cash to lend ever higher amounts than they used to, thus reducing the need for depositors' cash, and hence reducing the rate to the lowest they can get.

This is just my stab at answering, and I am not a banker, so take the answer with a pinch of salt.

RG2015

Ocelot said:

dosh37 said:

wmb194 said:

dosh37 said:

wmb194 said:

If you compare the Swanlow Park data with the Bank Rate's history it looks like, for instant access, it's sometimes above and sometimes below. The Swanlow Park data isn't necessarily indicating the the best available rates, though.

You can put these data together to make a chart if you're really interested.

https://www.swanlowpark.co.uk/savings-interest-data

https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp

hmm - the Swanlow Parks links give a Firefox security risk. Not exactly confidence inspiring.

I'm not really surprised by the quality of responses on MSE.

It's fine for me on my iPad. The truth is, it's seems you're in a bad mood and don't want to hear any answers. 

You still haven't clarified what you're really asking: actually only interested instant access rates?

I thought my originall question was clear enough.

In the past savings interest rates were always above the BoE rate. That is no longer the case.

I asked a simple question. Why?

I was bombarded with responses that seemed to suggest I am an idiot for asking why. Maybe I am an idiot but I would still like to know the answer.

I think the answer is that big banks have other ways of getting money nowadays, so many don't offer anything other than token rates, since they don't really need your money.

Also, with the amount of money a bank has to hold in cash in reserve being effectively abolished (or certainly very low), they need even less 'concrete' cash to lend ever higher amounts than they used to, thus reducing the need for depositors' cash, and hence reducing the rate to the lowest they can get.

This is just my stab at answering, and I am not a banker, so take the answer with a pinch of salt.

What we need is a run on the banks to sort out the men from the boys. 

wmb194

Ocelot said:

dosh37 said:

wmb194 said:

dosh37 said:

wmb194 said:

If you compare the Swanlow Park data with the Bank Rate's history it looks like, for instant access, it's sometimes above and sometimes below. The Swanlow Park data isn't necessarily indicating the the best available rates, though.

You can put these data together to make a chart if you're really interested.

https://www.swanlowpark.co.uk/savings-interest-data

https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp

hmm - the Swanlow Parks links give a Firefox security risk. Not exactly confidence inspiring.

I'm not really surprised by the quality of responses on MSE.

It's fine for me on my iPad. The truth is, it's seems you're in a bad mood and don't want to hear any answers. 

You still haven't clarified what you're really asking: actually only interested instant access rates?

I thought my originall question was clear enough.

In the past savings interest rates were always above the BoE rate. That is no longer the case.

I asked a simple question. Why?

I was bombarded with responses that seemed to suggest I am an idiot for asking why. Maybe I am an idiot but I would still like to know the answer.

I think the answer is that big banks have other ways of getting money nowadays, so many don't offer anything other than token rates, since they don't really need your money.

Also, with the amount of money a bank has to hold in cash in reserve being effectively abolished (or certainly very low), they need even less 'concrete' cash to lend ever higher amounts than they used to, thus reducing the need for depositors' cash, and hence reducing the rate to the lowest they can get.

This is just my stab at answering, and I am not a banker, so take the answer with a pinch of salt.

Other than the odd teaser account and when they're desperate e.g., the market stress at the height of the GFC, big banks have tended to have poor rates anyway. 

As you say, they have access to a wider range of borrowing e.g., captured* business deposits, they have the collateral i.e. gilts to borrow easily from the Bank, borrowing on the stockmarket i.e. corporate and hybrid bonds, the large ones can often access good borrowing rates abroad and they're better trusted by other banks so can borrow in the interbank markets.

*Businesses tend to have both a harder chasing better deposit rates and/or lack the interest in doing so.

kaMelo

RG2015 said:
What we need is a run on the banks to sort out the men from the boys. 

If it was guaranteed they couldn't go whining to Government for a bailout then I wholeheartedly agree with you.

Nebulous2

We're in a time of flux. Since 2008ish, we've been living through QE, much of which made its way into the balance sheets of banks. My recollection is that prior to that interest rates were more competitive. I remember (if my memory isn't playing tricks)  something called escalator bonds where the interest paid went up every 6 months. The one I'm thinking of would have been around 1994, started at 9% and went to about 13% over 3 years. 

Now that the QE policy has stopped, or even reversed, banks may have to compete for money in a way they haven't had to for years. They are still testing the waters to see what that looks like. In the meantime people who were plugging away at 0.6% interest for 18 months are finding it hard to contain their glee at getting 7% on a regular saver (myself included.) How much free publicity has that generated?  

It's still substantially behind inflation however..... 

Mr._H_2

dosh37 said:

Band7 said:

dosh37 said:

My original question has not been answered.

All I have seen are responses telling me that 'savers have never had it so good'.

This is clearly rubbish (probably trolls).

Does anyone have a sensible answer?

Are you unwell?

First you "don't remember a time when savings interest rates were actually below the BoE interest rate"

Then "all" you see "are responses telling me that 'savers have never had it so good'" - despite nobody having said this

You then further refer to the factual responses as rubbish, and to the posters as probably trolls

May be take some of your own medicine and only post sensible answers?

another troll - get a life!

I’ve read this whole thread; there’s only one Troll here, and it’s none of the people providing the answers. Perhaps the word “troll” doesn’t mean what you think it means? People providing factual answers that you don’t like, because they interfere with your world view, are not trolls. On the other hand, asking a vague question and then sticking your fingers in your ears and shouting “la la la! I can’t hear you!” whenever someone provides a response you don’t like, is classic trolling.

subjecttocontract

I have to smile when the banks/ building societies send me out a customer satisfaction questionnaire. This usually includes a question along the lines of ' is there anything else the bank could do to improve customer satisfaction ?'........I usually answer Yes. Offer market leading savings interest rates instead of the uncompetitive rates currently on offer.

Then of course, there is the repeated email asking me to agree to go paperless. Why would I agree to go paperless ? It will no doubt improve the banks profitability but cost me more to personally print out their documents.......I'm not falling for that one without an incentive.

Mr._H_2

subjecttocontract said:

I have to smile when the banks/ building societies send me out a customer satisfaction questionnaire. This usually includes a question along the lines of ' is there anything else the bank could do to improve customer satisfaction ?'........I usually answer Yes. Offer market leading savings interest rates instead of the uncompetitive rates currently on offer.

Then of course, there is the repeated email asking me to agree to go paperless. Why would I agree to go paperless ? It will no doubt improve the banks profitability but cost me more to personally print out their documents.......I'm not falling for that one without an incentive.

How often do you feel that it would be necessary to print the documents yourself, if you went paperless?

subjecttocontract

Mr._H_2 said:

subjecttocontract said:

I have to smile when the banks/ building societies send me out a customer satisfaction questionnaire. This usually includes a question along the lines of ' is there anything else the bank could do to improve customer satisfaction ?'........I usually answer Yes. Offer market leading savings interest rates instead of the uncompetitive rates currently on offer.

Then of course, there is the repeated email asking me to agree to go paperless. Why would I agree to go paperless ? It will no doubt improve the banks profitability but cost me more to personally print out their documents.......I'm not falling for that one without an incentive.

How often do you feel that it would be necessary to print the documents yourself, if you went paperless?

For me only printing a document once would be a problem because I don't have a printer. When I need to print a doc I visit my local library..........and I don't want to do that unless I really have to. 

Neither do I have a 'smart' phone. Again this is something some large number of organisations assume one has.