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Nationwide Attacks Rivals’ Practices
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(09-01-08) - Leading building society Nationwide has accused competitors of deceiving customers in order to top ‘Best Buy’ tables. writes Dan Drage dan.drage@consumerchoices.co.uk |
They have described practices whereby banks entice customers with high rates of interest, but fail to inform the customer when this high interest rate deal expires. Customers are then relegated to an interest rate that is lower than the market average, and are subject to less favourable returns in the long term.
Matthew Carter of the Nationwide suggests that it ‘makes no sense for customers to constantly change their savings accounts’, adding ‘with many savings accounts, with introductory deals launched last year, savers could soon be languishing in accounts paying lower rates having enjoyed potentially high returns.’
This practice is not new; banks have been using these methods to boost their products in newspaper ‘best buy’ tables for a significant amount of time. The main provider to the media of this comparative information is the financial information service Moneyfacts, who back the Nationwide’s campaign for more transparency in the matter. Spokesman Andrew Hagger had this to say:
"If you were a customer with a short term deal who received a letter warning you it was about to end and inviting you to consider another attractive deal, your relationship with the bank or building society is likely to last much longer."
Chris Eagle, Commercial Manager at CreditChoices, feels that the maturity date of the offer should be disclosed before you sign up:
“The expiry date of any introductory offer should be disclosed to any potential customer before you sign up, with a reminder issued just before expiration. Think carefully before you choose where to park your savings, introductory offers can seem dazzling, but you should be thinking long term."
Related article - Use our Savings Calculator to see how much interest you could be earning.
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