The large UK banks continue to offer businesses poor value products according to research from Savings Champion.
Across the board, businesses receive lower interest rates on both current accounts and savings accounts. The only two exceptions quoted are Nationwide’s 1-year Fixed Rate Bond Business Rate 4.90% and Cynergy Bank’s Business Current Account offering 1.5% on balances up to £25,000.
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With regards to savings, business customers aren’t faring any better either. On instant access savings accounts, all the major UK banks provide lower returns for business customers in comparison to retail customers. The only exception is TSB which offers 1.50% on balances above £5,000 with its Instant Access Account (Business). The difference on a £10,000 deposit ranges from 0.06% at HSBC to 1.1% at Cynergy Bank, which launched its business saver account in 2023 that currently pays 4.00% AER.
Businesses short-changed by the major banks
Anna Bowes, co-founder, Savings Champion said: “Businesses often get a raw deal when it comes to earning interest, whether that is in a savings account or a current account. And they often tend to leave a lot of cash in their current accounts.
“So, it’s really refreshing to see a provider paying interest on money held in their business current accounts, as none of the largest high street providers pay anything substantial. Of course, businesses can do better if they move any excess cash into savings accounts. But once again the high street banks are unlikely to be a good choice to make a meaningful return.”
Nick Fahy, Chief Executive at Cynergy Bank added: “This research shows what many SME owners already know. They are short-changed by the big banks in the UK. As a challenger bank, we are committed to providing businesses with a new standard of value and service that has been lacking in the industry. Our new Business Current Account provides a genuinely clear charging structure connected with financial rewards for in credit balances.”
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