Battle of Borrowers Versus Savers Over Base Rate Cut

CHESTER, England, May 31, 2012 /PRNewswire/ --

• 45 per cent of Brits polled are concerned about the impact a base rate cut would have on savings*
• 15 per cent welcome a cut to help with mortgage repayments

With the International Monetary Fund (IMF) recommending the Bank of England should consider cutting base rate further, the UK's number one comparison site MoneySupermarket.com asked site users whether they thought it was a good idea, and found three in five (60 per cent) are against a cut to the base rate.

When asked about the impact a cut could have on their finances, 45 per cent say it would impact their savings with rates already at a very low level following a stagnant 0.5 per cent base rate over the last three years. In addition, 15 per cent of respondents are against a cut because inflation still needs to be controlled.

However, on the other hand, 35 per cent say cutting the base rate would be a good move; 15 per cent of those polled hope it would result in a decrease to their mortgage payments, and a fifth (19 per cent) support a cut to base rate believing it will help stimulate growth in the UK.

Kevin Mountford, head of Banking at  MoneySupermarket.com  said: "It's no surprise savers have come out fighting against the proposed rate cut as they have suffered from low rates since base rate fell to a record low in March 2009, especially those who relied on the savings interest to provide a regular income. The majority of borrowers on the other hand have benefitted from the low interest rate environment which has resulted in many people having lower monthly mortgage payments. A base rate cut would not be good for banks as it could make it more difficult for them to be flexible on pricing, and as we have seen more recently on mortgages, it could give them the perfect opportunity to decouple rates from Bank of England base rate altogether.

"Although savings rates may appear low, it is still worth taking advantage of the best deals on the market, and with the recent fall in inflation, this should really help to encourage people to start saving again, where they can. There are a number of savings accounts which now beat inflation and consumers need to make sure they are on the best deals possible to maximise their returns. The top paying savings accounts currently offer rates over six times that of base rate so by choosing these, you can reduce the impact inflation has on your pot. Even putting aside £10 a week could make all the difference to your emergency saving funds - vitally important should your circumstances change, for example, if you lose your job.

"Whatever your financial situation, there are some small steps that can be taken to ensure you are maximising your income. Reviewing all of your household bills and not paying over the odds for things like energy, car insurance and day-to-day expenses can save more than you expect. Switching to the best deals using MoneySupermarket could save over £1,000 for your family."

- Ends -

Notes to editors:

*MoneySupermarket webpoll

Do you think a base rate cut from the Bank of England is a good idea?

• Yes- it will stimulate growth in the UK- 19.2%
• Yes- it will mean that my mortgage payments go down- 15.4%
• No- my savings rates are already too low- 44.6%
• No- we need to control inflation- 15.2%
• I don't mind- this won't affect me- 2.3%
• I don't know- 3.4%

Total votes: 2,125 Poll ran from 25^th May to 30^th May 2012

MoneySupermarket.com's customer commitment

• No other site compares more prices or products
• We are independent so only find the best deals for you  
• The price you see is the price you pay - you don't need to go direct and you won't get a better deal doing so  
• Your details are safe with us and we won't sell them to anybody

MoneySupermarket.com compares (at 29^th March 2012)

• 98 car insurance providers and 81home insurance providers
• 11 broadband providers and 18 energy providers  
• 31 unsecured loan and 5 secured loan providers
• 62 mortgage lenders and 28 credit card providers
• 67 savings providers and 37 current account providers.
• Over 1,750,000 mobile phone deals

We promise to be clear and impartial

• All the products in our full search results tables are displayed in a completely unbiased manner.
• We don't add fees or commissions on to the prices we compare.
• There may be times when another site compares more companies than us on a particular product, perhaps because of market changes or technical issues. You'll be able to see this and know we are working hard to fix it.

We promise to be trustworthy

• We never use your data to make unwanted sales calls or send you spam.
• We never pass your personal information to third parties unless you give us permission to do so.
• Even if you choose to receive additional information from us, you can opt out at any time.
• We promise to be supportive.
• You can use our community forum to get information and help from other customers.

If you need further help or support, you can contact our sales advisors or customer services agents.

For further information please contact:

Paul Lawler
PR Manager Financial Services
+44-(0)1244-370371
+44-(0)787-237-9545
[email protected]

SOURCE moneysupermarket.com

WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?

440k+
Newsrooms &
Influencers

9k+
Digital Media
Outlets

270k+
Journalists
Opted In

GET STARTED