MP attacks banks 'profiteering from poorest

Consumers who have no internet access are getting a raw deal from the high street banks who only offer the best rates of interest to online customers, an MP warned today.

The Liberal Democrat's shadow chancellor, Vincent Cable accused the banks of "profiteering" off their poorest customers who use the branch rather than the internet, and who need instant access to their money. The interest these customers could expect was often pitifully low, he claimed.

"There are a number of good headline rates being offered to savers as long as they are prepared to bank online or wait the long notice period before getting their money," he said.

"For the majority of us and especially those on lower incomes, we want to be able access our savings accounts instantly from our local branch.

"Yet these accounts have rates consistently below the Bank of England's base rate by between 1.5% and 1.8%. Our research has also shown that rates on these have tended to lag behind when interest rates have risen.

Mr Cable said that although interest rates had risen by over 1.25% over the last year, instant savings accounts had failed to pass on the whole rise to savers and he indicated that if this failing applied "across the board" it could be losing the customer potential savings of ?162m a year.

"Banks need to stop profiteering off their savers. It is absolutely essential that the banking sector promotes saving over borrowing and the only way to ensure this is by matching its rhetoric on publicity with reality."