The choice of savings accounts on the market has fallen to the lowest levels since at least 2007, according to a financial information website.
The number of “live” savings accounts, including cash Isas, has dipped below 1,400 deals for the first time since Moneyfacts’ comparable records started in 2007. The website found 1,398 deals still available.
The choice of products has shrunk by 370 since March 1, Moneyfacts.co.uk said.
To compound savers’ woes, average savings rates for many types of account are now sitting at record lows.
All average rates across all account types looked at by Moneyfacts had fallen below 1% for the first time on record.
As it stands, savings providers may be reaching their desired subscription levels quicker than they expect.Rachel Springall, Moneyfacts.co.uk
For example, in July, an average one-year fixed-rate bond paid 0.70% and a typical one-year fixed-rate Isa paid 0.61%.
The average rate on an easy access savings account is now 0.24% – less than half the 0.59% rate savers could typically find in January.
Rachel Springall, a finance expert at Moneyfacts, said: “Savers may well feel apathetic in a low interest rate environment to store cash away, but for those who want to build a savings pot in light of the uncertainty that the coronavirus pandemic has instilled, then easy access accounts may well remain a firm favourite due to their flexibility.”
She suggested that savers look towards the challenger banks or National Savings and Investments (NS&I) for better returns, as some high street providers pay just 0.01% interest.
Ms Springall continued: “Overall, the outlook for the savings market appears uncertain and providers will need to continue to adjust their market position if they are dealing with an influx of deposits.
“As it stands, savings providers may be reaching their desired subscription levels quicker than they expect, particularly if savers put away additional disposable income amassed during lockdown.”