Millions of Brits still missing out as £366billion stagnates in low interest accounts

• Over £366billion[i] is still sitting in UK current and savings accounts earning returns of 1% or less
• There are 13m current accounts[ii] held in the UK with a balance of over £5,001, with the average held in those accounts standing at £23,700
• Almost a fifth (17%) of UK adults admit to having never checked what rate of interest they are earning on their savings 

Millions of Brits could still be missing out on over £1,000[iii] extra income a year because their savings are in low- or no-interest paying current accounts, analysis from Yorkshire Building Society and CACI suggests.  

In January the mutual and CACI shared data that there was £380bn held in accounts paying 1% or less, that figure has reduced, but only by 4% meaning there is still over £366bn sat in low paying accounts.

The analysis also shows that there is still nearly 13 million current accounts held in the UK with balances above £5001, and of those people who hold at least £5,001 in their current account, the average balance held is £23,700. New consumer research also released by the mutual highlights over a third (36%) of UK adults admit they keep their savings in their current account.

The new research[iv] also showed despite almost three quarters (72%) of brits confirming they had checked the interest rate on their savings account in the last six months, a fifth (17%) admitted they have never checked what rate their savings are earning and over a half (55%) haven’t moved their savings in the last year meaning millions are potentially losing out on hundreds of pounds in interest.

Chris Irwin, director of savings at Yorkshire Building Society, said: “Despite the attention savings interest rates continue to have following the significant increases in the Bank Rate, it’s surprising that there continues to be such large pockets of people who are significantly missing out on savings interest.

"We started the year highlighting that keeping large amounts of funds in low paying current accounts has become a costly mistake for millions. It’s encouraging to see that for a small number of people they have made moves to improve the situation however there is still an incredible amount of money not earning returns like they could be.  It’s understandable to want to have money accessible for emergencies or even topping up everyday expenses, but with so many instant access savings accounts currently still available in the market paying much higher returns, access requirements shouldn’t be a barrier to attaining higher rates.   

“As our research has also shown keeping on top of savings rates and moving money around isn’t something everyone keeps up with. We really urge savers to review the home of your savings and take positive steps to making it worker harder for you.”

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk said: “Consumers will have different reasons for why they save and how, but it is essential they check that their account is paying a decent return of interest on their hard-earned cash. Loyalty does not always pay and the convenience of stashing cash in a current account means many savers are getting little to no interest. Interest rates have changed considerably over the past 12 months but if someone does not proactively switch, they could be losing money in real terms due to inflation. It’s quick and easy to switch accounts to chase a better return of interest, but some may feel it’s not worth doing if their priorities are focused on using their savings to cover the cost of living.”

Yorkshire Building Society, who commissioned the research through Opinium, hopes people will give some attention to their finances, take steps to review their money situation and increase their potential income.