Savings Account Small Print

Talking about Lombard Direct’s recent decision to savagely cut the interest rate on their savings account, The Motley Fool points out the gaping holes in the Banking Code, which makes the cuts above board, if not entirely fair:

Section 4.6: “…at least once a year, we will send you a summary of… current interest rates, unless your account has less than £500 in it.”

Section 4.8: “If you have a variable-rate account with £250 or more in it and the interest rate has fallen significantly compared to the Bank of England base rate, we will contact you within a reasonable period of time…”

Lombard Direct has cut up to 3.67% a year off some of their savings accounts, which in some cases means the interest paid is now just over a tenth of what it used to be. The lesson here, as ever, is to check the deal you are getting, and then start looking at the best buy tables. Don’t be loyal to banks that are taking your custom for granted.

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