UK-based Sainsbury’s Finance has announced that it is offering a rate of 3% gross AER on its internet saver to customers opening the account with between GBP5,000 and GBP100,000.
The company said that this rate is guaranteed to be 2% above the Bank of England base rate for 12 months from the account being opened.
If a withdrawal is made during this period, the interest rate reverts to the account’s standard rate of interest, currently 1.25% gross AER. Any existing customers with Sainsbury’s savings accounts can also take advantage of the offer, added Sainsbury’s.
Helen Cook, head of savings at Sainsbury’s Finance, said: Since October last year, the Bank of England base rate has fallen from 5% to just 1% which is the lowest rate in the history of the central bank. Given this, interest rates on savings accounts have fallen with the average rate on instant access and notice accounts now just 0.51% and 0.29%, respectively.
The savings industry needs to be creative in finding ways in which to encourage people to save money in an environment of such low interest rates, which is what we are trying to do with our internet saver offer.
