Low interest rates may have actually encouraged consumers to save, according to financial information website Moneyfacts.co.uk. It has been widely reported in the past 18 months that low interest rates are doing little to incentivise consumers to save, with minimal returns offered on ISAs, bonds and savings accounts . However, Moneyfacts believe that the decreased mortgage payments that borrowers are enjoying are increasing their disposable income and allowing consumers to deposit more money into a savings account .
Head of press and public relations at Moneyfacts, Darren Cook, spoke of this trend, but also warned that many people have suffered at the hands of the plummeting interest rates offered on savings accounts. People who rely on savings to supplement their income, including pensioners, have been perhaps worst affected by the lower interest rates.
The findings perhaps exaggerate the impact of these low interest rates on increasing the likelihood of people saving. National Savings and Investments did recently reveal that the number of people regularly depositing funds into a savings account was up by 2 per cent since 2005, though the amount of money they are saving remained constant at about 6 per cent of net income.
Bank of England Interest
Financial Services > e-banking > Banking news
Bank of England Interest
Fri, 18 Dec 2009
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