Savers ‘need to shop around for better rates’

Savers should shop around to ensure they are making the most from their bank deposits, one expert has suggested.

David Kuo, Fool.co.uk’s director, said that financial institutions are “desperate” for money at the moment and as such they are offering a number of incentives in order to attract customers.

“If anyone’s got money sitting in their current account then they should look around as some interest is better than no interest which is what many current accounts are offering,” he advised.

However, Mr Kuo added that people need to make sure they do not just look at the headline rates, explaining that some products may have restrictions on them.

Fixed-rate bonds, for example, typically offer better rates than savings accounts but they can require that deposits are tied up in them for longer periods of time.

According to moneysupermarket.com, approximately £7.7 billion is being lost by UK consumers each year because they are not switching to accounts with more competitive interest rates.

By Chris Trimble