LONDON (CU)_Amid travel restrictions and border closures for weeks if not months last year, large amounts of savings cash is said to have accumulated in the bank and building society accounts of many people. According to an expert from economic research consultancy Pantheon Macroeconomics, the additional cash saved since the beginning of the pandemic, known as “excess savings”, rose to £168 billion.
Against this backdrop, Yorkshire building society has announced a slivers of good news for those “loyal members” who have been looking for a decent return on their money. The British financial service provider said it has decided to invest £16 million in order to boost interest rates for its savers. It noted that almost 1.7 million of customers are expected to benefit from the move.
Accordingly, the building society will increase the interest rates on many accounts by 0.2 per cent. The benefit will be extended to its Access Saver, Triple Access Saver and Internet Saver accounts, while the customer is required to have opened the account before 29 January 2021 in order to qualify.
Meanwhile Loyalty Six Access Saver account recently launched by the organisation pays a variable interest rate of 0.65 per cent on balances up to £50,000. The account can be opened with a minimum of £1, and customers may withdraw cash on up to six occasions a year without a penalty. Yorkshire members who have opened an account or taken out a mortgage before 1 January 2020 are qualified for this scheme.
Similarly, Bank of London and the Middle East has also reportedly decided to increase its profit rates for several fixed-rate accounts, with a rate of o.8 per cent for a one-year term and 1 per cent over two years.
This boost in interest rates by financial institutions will be good news for those who have had huge sums sitting in their accounts for months, if not a year, throughout the pandemic, as some experts warn that the economy may overheat if households decide to spend a significant portion of these excess savings.
