Savers urged to move as big banks offer around 1% on easy-access accounts

A savings guru warns that three major UK banks are marketing easy-access savings accounts that pay about 1% interest, leaving savers’ money eroded by inflation. The accounts named are Halifax Instant Saver, Santander Everyday Saver and Lloyds Easy Saver. The warning comes as consumer demand for higher returns increases and piles of cash sit in accounts that fail to keep pace with rising prices.

Sylvia Morris, a well-known savings adviser cited in the notes, flags that even the best-known offers from the big five banks lag inflation and the likely course of policy rates. On balances up to £25,000, Halifax’s Instant Saver is not widely advertised as a general sale product, but customers can end up in it after using its easier-access accounts such as Everyday Saver or Bonus Saver for a year. Across the major banks, the typical easy-access rate sits near 1% or slightly above. NatWest’s Flexible Saver pays about 1.06% on up to £25,000, Barclays’ Everyday Saver about 1.05%, and HSBC’s Flexible Saver offers around 1.15% from £1. These figures illustrate a wider pattern where the best available returns among the big banks are still far below inflation and the broader market.

The broader background matters for savers. With the Bank of England base rate widely expected to be cut, some market observers anticipate the base rate moving from 4% toward 3.75% in the near term. If that happens, the gap between easy-access savings rates and inflation could widen further, and even the modest edge that some savers enjoy now could disappear. The consequence is a growing amount of money sitting in current accounts that earn little or nothing when moved into savings accounts, a situation the notes describe as financially unsatisfying for households.

A key reason for the low headline rates at the big banks, Morris notes, is the practice of using promotional bonuses to attract customers, only to relocate them after the bonus period ends to a low-rate product. For example, Halifax’s Instant Saver is not a continually advertised option; rather, customers often transition into it after holding other Halifax easy-access accounts for a year. Even at generous balances—some headlines cite £25,000 or more—rates typically hover around 1% and only slightly above for higher sums, exposing savers to real-terms losses when prices rise.

For savers able to move from bank-provided offers, there are several high-rate options available from smaller banks, building societies and digital providers. Paragon Bank’s Spring, an app-based account, currently pays about 4.11% on easy-access funds, a rate that stands well above the big banks’ offerings though it may fluctuate with market conditions. Cahoot, the online arm of Santander, offers the Simple Saver at about 4.4% but with a one-year term; after the year, Ms. Morris notes, balances are moved to Cahoot Savings, which pays roughly 1%. These kinds of promotions illustrate how savers can achieve markedly higher returns by choosing providers outside the traditional high street.

For those willing to consider building societies and other non-bank lenders, the landscape looks even more favorable. Skipton Building Society’s Bonus Saver is currently among the top rates at about 4%, though savers are advised to set a reminder to switch once the bonus ends. Family Building Society’s Market Tracker offers around 4.14% but is expected to drop to roughly 3.98% next month as market conditions adjust. Kent Reliance Trust, a specialist savings provider, lists a one-year fixed rate near 4.51%, with Chetwood Financial and GB Bank close behind at roughly 4.4%. In the cash ISA arena, Charter Savings Bank’s one-year fix sits near 4.3%, joined by Tembo and Investec in similar territory. While these numbers can move quickly, they reflect a broader shift toward higher promotional rates outside the largest banks.

There are also practical caveats. Some offers, like Skipton’s Bonus Saver, restrict access to joint accounts; the product can be opened in only one name, and none of the highlighted cash ISAs from these providers are typically available for joint ownership. This is a reminder that the appeal of top rates must be weighed against account structure and accessibility, especially for households with multiple earners or joint savings goals.

The overarching message for savers remains clear: if you can snub your current account provider’s promotional rates, you can often find significantly higher returns elsewhere. Moving funds is typically straightforward. Transfers can be arranged using faster payments, and money often arrives in the new account within two hours or sometimes immediately. Opening a new account and linking it to your existing current account can take as little as about 10 minutes, after which you can direct funds to the higher-paying option. The potential gains are meaningful; depending on balance and term, switching could yield roughly four times the interest offered by the low-rate accounts, over the same time horizon.

In practice, the path to better returns requires vigilance and timely action. Promotions and introductory rates can vanish quickly as banks adjust to shifting policy rates and competitive pressure. Analysts and savers alike emphasize the importance of reviewing your savings strategy now, rather than waiting for a rate move that could further erode purchasing power. If you have money parked in a big-bank easy-access account that pays around 1%, moving to a top-rate alternative could preserve value and deliver a materially higher return in the near term. The time to act is now, before promotions end and the market shifts again.