Millions of savers could be missing out on best rates because they don’t bank online

Published by Stephen Little on 05 February 2019.
Last updated on 05 February 2019

Unhappy pensioner

Millions of older savers could be missing out on the top interest rates because they don’t bank online.

Research from financial advice website Moneyfacts has found that a third of easy access deals (34%) offer no branch access.

Savers who have yet to get online, particularly older savers, could be missing out on the best deals as a result.

According to data from the ONS, 4.5 million adults in the UK had still never used the internet by 2018. Of this, 2.6 million were aged over 75. 

Based on someone with £10,000 to put away, the best easy access account rate is currently offered by ICICI Bank UK at 1.55%, which requires customers to apply online and does not offer any branch access.

Meanwhile, the best account with branch access comes from Yorkshire Building Society and pays 1.41%. In comparison, SAGA’s telephone access saver, designed for the over 50s, is available nationally but pays just 0.70%.

The research revealed that the percentage of easy access deals without branch access has been steadily increasing over the past five years.

In February 2014, 29% of easy access accounts did not have branch access, rising to 34% in February 2019.

Over the same time, the percentage of easy access deals which can be managed online has also increased, going up from 53% in February 2014 to 62% in February 2019.

Rachel Springall, finance expert at Moneyfacts, says: “Those savers who have yet to jump in on the internet craze may be disappointed to find out that a third of the easy access market provides no branch access.

“As it stands, savers who have yet to get online will be missing out on the best interest returns on easy access accounts, which is bad news for those silver savers who may rely on their savings income – inevitably leaving them feeling left behind.”

Bank closures

There is growing concern that increasing number of bank branch closures could be leaving people without access to cash, hitting the elderly and the disabled particularly hard.

Whilst there has been a shift online and to mobile, for many people this is not possible and they are unable to travel to another branch.

Ms Springall says: “As savers may have already noticed, some of the biggest bank brands are in the process of closing hundreds of branches, including Lloyds Banking Group, RBS Group and even Santander.

“With thousands of branches set to close, and the percentage of deals offering branch access decreasing, this may pose a problem for those who rely on them to manage their money.

"These growing signals of a changing landscape on the high street are steering more consumers to bank online, regardless of their age or circumstances.”

Bank branch closures have increased in recent years and are shutting at a rate of 10 a week.

Last month, Santander announced plans to axe nearly a quarter of its branch network as a result of more customers moving online.

According to the bank, the number of transactions carried out in branches has fallen by 23% over the past three years, while digital transactions have grown by 99% over the same period.

Caroline Abrahams, charity director at Age UK, says: “The seismic shift towards online banking in recent years means that the four million or so older people who are not online are effectively locked out of the best interest rates, while people who are not in a position to switch regularly often find themselves on ‘off-sale’ products with dwindling returns.

"Banks and other financial providers must stop penalising people who have done their best to save, and ensure that good deals remain accessible to those savers without online access.”

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Santander are closing my

Santander are closing my local branch so I am moving my account to a different provider. There are two issues with on-line banking. Firstly what happens when a person living alone dies? How do their heirs find out details so as to claim? Secondly what happens when the IT system goes down be it a power cut or a failure? Too much risk for me.

We are almost 80m- I have

We are almost 80m- I have banked with Nat West in Milford Haven since I was 19.... Obviously appreciated it because we did not leave it. . Now we have no bank near to us... only a mobile once a week for an hour and I do not want to climb up the steps or walk up the hills to get to it nor could I guarantee to get there in the hour they are there. .
Now there is no option but to change to a bank still in our town or withdraw it to cash and keep it at home. .
I can do online banking but many people my age do not have computers or access to online banking. I think it is a disgrace.