A savings war could be approaching in the easy access savings accounts market, an expert has claimed.
The newly created easy access savings account, offered by an Icelandic company, may shake other savings providers into action, stated Stuart Glendinning, managing director of MoneySupermarket.com.
These comments echo those of Sean Gardner, chief executive of MoneyExpert, who also predicted fiercer competition in the savings market.
Landsbanki Islands hf has offered an account with a headline rate of 5.2 per cent and guarantees to exceed the Bank of England base rate by 0.25 per cent until October 2009 and not drop below the rate until October 2011.
Mr Glendinning notes that this is the longest guarantee of its kind currently available in the UK.
However, the savings account carries a minimum deposit of £250, which may not suit small-scale savers.
There are other drawbacks too, Mr Glendinning explains: "This account carries the pretty significant caveat that any withdrawal results in no interest being credited in that month on the whole balance, not just the sum withdrawn.
"Hence, any saver making 12 withdrawals in each separate calendar month will receive no interest."
Expert predicts savings war
Expert predicts savings war
Thu, 12 Oct 2006
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