Savings accounts for existing customers not always the best deal Go compare with our comparison table

Savings accounts for existing customers not always the best deal

26 October 2010 / by Rachael Stiles

Loyalty does not always pay when it comes to finding the best savings account deal, according to

Market research by the comparison website shows that while savings account providers often tempt existing customers to keep their savings with the same bank, exclusive offers do not always provide the best interest rates on the market.

Customers should be wary of going with 'existing customers only' deals, says, which might seem like the easy option, and a better rate than that offered to new customers, but they might still find better returns elsewhere.

Not only should consumers shop around to find the best savings rate, but they should continue to check rates regularly to ensure that they are getting "as much bang for their buck" as they can while interest rates remain low.

Moneysupermarket counsels savers that it does not take a lot of effort to find the best savings account, but that the rewards can be significant, and that if they have debts then they can use the higher returns from their savings to repay their debts faster.

For example, some providers are offering their existing customers 'exclusive' rates of around 2.00 per cent on instant access savings accounts, the analysis shows, but by shopping around, savers could get a market leading 2.90 per cent with the Post Office Online Saver.

Commenting, Kevin Mountford, head of banking at said: "There is a misconception amongst consumers that they will get preferential deals from their current provider when taking out a new financial product. However, a brief look across the high street banks reveals that it is very much a case of swings and roundabouts, with no single provider offering best buys across the board."

Savers need to be 'scouring the market place' he said, to seek out the most competitive deals from other banks and building societies.

"It's understandable that people want to keep their finances simple and the convenience of doing all their banking with one provider is often more important to them than securing the market leading rate for a loan or credit card.

"For others, they prefer the service provided by their bank but it still amazes me how many people are dissatisfied with their bank, but still remain loyal. Banks rely on this apathy from their customers and during this difficult economic period, consumers need to be generating as much value from their money as possible."

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ProviderAccountInterest Rate (AER)TermApply
1.10%Instant AccessMore Info >
MARKET LEADING: Earn 1.10% gross/AER Instant Access. No notice periods. Unlimited payments and withdrawals. Pay in from £100. RCI Bank are protected up to a total of €100,000 by the FGDR, the French deposit protection scheme. Manage account online.
0.75%Easy AccessMore Info >
0.75% gross/AER on balances from £1,000 to £1 million. Guaranteed to be at least 0.50% above Base Rate** until 31st December 2017. Unlimited withdrawals without restriction or loss of interest.
0.75%Current Account
Instant Access
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Innovative new banking service powered by Clydesdale and Yorkshire Banks. Get your current account and instant access savings account working together. Earn 0.75% AER on ALL instant access savings balances, and 0.25% AER on current account balances up to £2,000 (From 2nd May 2017, 0.50% AER variable on £1+ will apply). No monthly account fee
0.86%Easy AccessMore Info >
Earn 0.86% tax free/AER variable. Open with £100. Unlimited free withdrawals. Transfer in ISAs held elsewhere - no limit
up to 0.05%Instant accessMore Info >
0.05% AER Gross (variable) for balances over £50,000 (0.01% AER Gross variable for balances under £50,000). Open with £1. Interest paid monthly. No penalties and no withdrawal charges. Manage your account online, in branch or by phone. Over 16s only
0.01%Instant accessMore Info >
0.01% AER Gross (variable). Open with £1. Interest paid monthly. No penalties and no withdrawal charges. Manage your account online, in branch or by phone. Over 16s only

Gross is the interest you will receive before tax is deducted.

AER stands for the Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year.