The sheer number of non-high street banks is overwhelming...

Who are all these banks.
Building Societies I understand ( every town used to have have its own BS) --BUT..
looking up Best ISAs, Fixed Rates, etc so many banks I have never heard of.
Also their rates are invariably worse  than the high street banks.
Are they  trustworthy or only for the rich and tax dodgers (a lot of them  appear to be not UK)

Comments

  • jaypers
    jaypers Posts: 651
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    edited 4 November 2023 at 9:05AM
    Many are trying to get a slice of the action, be it loans, mortgages, savings etc. Important thing is to ensure that they are FSCS protected, in which case you are fine to deal with them if you like the look of a product. Never keep more than £85k per person in savings with any one institution (£170k for a couple). You can do a basic check here - https://www.fscs.org.uk/check/check-your-money-is-protected/
  • Aretnap
    Aretnap Posts: 5,137
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    Who are all these banks.
    Building Societies I understand ( every town used to have have its own BS) --BUT..
    looking up Best ISAs, Fixed Rates, etc so many banks I have never heard of.
    Also their rates are invariably worse  than the high street banks.
    Are they  trustworthy or only for the rich and tax dodgers (a lot of them  appear to be not UK)
    If your looking at the best buy tables why are you even noticing the ones with bad rates?

    Technology means that there's no need for banks to have a physical presence on the high street any more, which means it's easier than it once was for new banks to start up, without the need to build up a nationwide network of branches, no need for a local bank or building society to serve only one town etc. It does mean that if your notion of a bank is a building in your local high street then your less likely to have heard of the new ones. But more choice means more competition which means better rates, so it is a Good Thing for the consumer.

    Of course unless you go into a city centre you are unlikely to see many branches of Nat West or Barclays these days, so I would not be surprised if it was only old people who had a clearly defined idea of what a "high street bank" is in the first place.

    As above provided the bank has FSCS protection and you are not saving more than £85K they are all equally safe. Standards of customer service may vary, however a savings account (as opposed to a current account) is a very simple product for which you'll almost never have a need to contact customer services, so that's never been a major factor when I've chosen savings accounts.

  • Albermarle
    Albermarle Posts: 21,105
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    Who are all these banks.
    Building Societies I understand ( every town used to have have its own BS) --BUT..
    looking up Best ISAs, Fixed Rates, etc so many banks I have never heard of.
    Also their rates are invariably worse  than the high street banks.
    Are they  trustworthy or only for the rich and tax dodgers (a lot of them  appear to be not UK)
    Presume you meant to say invariably better ( not worse) .
    If I look at the Moneyfacts comparison site for one year fixed rate, the first 20 include no big banks at all, and only one small building society.

    Some of them are offshoots of foreign banks ( registered in UK ) whilst some are smaller UK banks that lend money out for car finance, small businesses, BTL mortgages etc . and take savings in to finance the loans. Which is a banks function.
  • masonic
    masonic Posts: 22,845
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    Established high street banks have a higher cost base than smaller internet-only banks. They also normally have shareholders wanting to see a profit margin and return on their investment, whereas its acceptable for newer banks to make losses for many years as they grow their market share. Aside from "gimmick" accounts that pay interest on limited balances, it would be expected that high street banks wouldn't be at the top of the rate tables, and generally are not. If the best rates were available from high street banks, the smaller challenger banks wouldn't get a look in.
  • Olinda99
    Olinda99 Posts: 1,174
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    didn't know there were any high street banks anymore thought they'd all left...
  • GeoffTF
    GeoffTF Posts: 1,336
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    Olinda99 said:
    didn't know there were any high street banks anymore thought they'd all left...
    There are still lots of banks and building societies in he city where I live.
  • Albermarle
    Albermarle Posts: 21,105
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    Ethical banking is becoming increasingly important, though still a relatively minor player in the sector, but that’s changing. Gatehouse offer a Woodland Saver with tree-planting per product, and many BS offer green or charity affiliate products (sometimes with lower rates but a good trade-off if it’s something you want to support). Big players such as Coventry BS are going for B Corp endorsement and smaller players such as Melton BS the FairLife Mark for fair trading. Even NS&I offer a competitive Green Bond at the moment.
    There are also specialist green BS (Ecology) and banks (eg Tandem, which is app-only). 

    You missed out Triodos, who were offering ethical banking before most people had ever heard of it ( first established in 1968) 
  • So I did, but that was a deliberate omission - they’re a better-known name in that market for that very reason, and they don’t usually offer table-topping rates. 

    As per the bank’s published history on their UK and NL websites, the ideas behind Triodos emerged in 1968, followed by a Foundation in 1971, but the bank itself doesn’t seem to have been founded until 1980. They’ve been in the UK since 1995. 
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