One personal and business bank account provider recently withdrew its 3.2 per cent interest rate best buy instant access saver after being inundated with applications for the savings product.
AA Savings’ new Internet Extra 5 had only been on the market for two short weeks before the banking provider decided to pull it from shelves. The AA – which like Lloyds TSB is part of the Lloyds Banking Group – had been hoping to keep the deal available until 2012, but as it topped the best buy tables for instant access savers, customers flocked to the offering in unsustainable numbers.
One AA spokesman remarked that the popularity of the account proved to be incredibly high, which led him to comment that people will save, even in the current economy, as long as decent rates are on offer. While no plans have yet been finalised, a new deal may be launched in 2012.
With the AA offering no longer available to savers, Spain-based Santander’s 3.1 per cent instant access saver now claims the top spot on the best buy tables. While Nationwide offers a competing product with a 3.12 per cent rate, the building society limits its customers to no more than one withdrawal without penalty in a 12 month period.
The competition for market share amongst the nation’s savings providers is fierce as retail banking institutions seek to increase their bottom line in the face money market turmoil. One savings expert remarked that LIBOR, the rate used to measure inter-bank lending, has hit 1.07 per cent, which has seen banks turning to their retail customers as cheaper options for funding mortgages and loans.