An independent tracker has uncovered a startling revelation that UK high-street banks allegedly withheld more than £200 million in savings interest from SMEs last month, as reported by Allica Bank.
Allica Bank‘s newly launched SME Monthly Savings Tracker meticulously monitors the average savings rates provided by major banks, including Barclays, HSBC, Lloyds, Nationwide, NatWest, and Santander. The tracker compares these rates to those offered by challenger banks for similar SME savings products.
According to the latest data released on May 7, significant banks are purportedly offering SMEs considerably lower interest rates, which remain stagnant for prolonged periods. On average, SMEs in the UK, with an approximate balance of £75,000 in business savings, receive less than 1.6% interest from major banks.
In contrast, challenger banks consistently offer significantly higher rates, with the best rate holding steady at 4.33%. This stark contrast results in nearly a 3% difference, translating to an additional £172 per month in savings for individual SMEs.
The disparity in savings rates between major banks and challengers implies that British high-street banks allegedly withheld approximately £208 million in savings interest from SMEs last month alone.
This data reinforces previous research by Allica Bank, indicating that SMEs are potentially entitled to over £7.5 billion in ‘missing’ savings interest annually.
Richard Davies, CEO of Allica Bank, expressed concern over the situation, stating, “SMEs across the country are getting ripped off when it comes to their business savings.” Davies emphasised the need for major banks to pass on better savings rates to their SME customers, especially amidst the current economic challenges faced by businesses in the UK.
