Santander and the vanishing best-buy savings rates. Why is it so difficult for savers to find out what they are paid
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UPDATED:
05:32 GMT, 16 May 2012
Santander has delivered some top rates through its esaver account, yet it has also been plagued by one of the curses of the modern savings market – a slew of different accounts, all with different rates and bonuses dropping off at different times.
And if that didn't make life hard enough for savers, when customers sign into the online banking facility, it just says ‘Santander esaver’ – with no issue number, or interest rate revealed.
As part of This is Money's Online Rate Honesty campaign, our man Lee Boyce heads out on the trail of the mystery savings rates.
Rate drop: With bonus accounts common with savings, why do some banks and building societies make it so difficult to find the rate of interest
Bonus accounts and vanishing savings rates
The rise of the bonus culture has made a simple product – the easy access savings account – infuriatingly complicated.
It is common for savings accounts to carry bonuses that can expire as little as a year after the account is opened. This means that unless savers stay vigilant, they can end up falling onto a paltry rate of interest.
Why do banks hide rates
This is Money has campaigned for savings rates to be printed on statements and online, so savers know what rate they are getting, especially in a time of low paying accounts.
So why aren’t banks and building societies more transparent
Account providers often direct savers to long list of savings rates, expecting them to sift through lists account names and dates.
Alternatively, it is a potentially long phone call to your bank to match up account numbers and rates being paid.
Of course, it is in banks' and building societies' interests to keep details quiet, because it helps savers slip onto low rates without being triggered into moving on by easily being confronted by them.
Many of the top paying accounts on This is Money's instant access online savings tables come with a hefty bonus which are lost 12 months’ down the line.
And shunning these gimmicks can prove costly, as every single one of the top ten paying instant access online savings accounts in This is Money’s tables include a bonus.
So unless savers want to plump for Sainsbury's 2.7 per cent [more details] paying eSaver Special, over Coventry's 3.15 per cent paying Online Saver [more details], they must bite the bullet and keep a keen eye out for when their rate drops.
But that job is being made harder by some account providers who don't display the rate of interest on the web pages of customer's online accounts.
And one of the big players still refusing to let savers easily find out what rate they are getting is Santander.
Savings Champion, the savings rate tracker service, has told us how hard it is for a customer to find their rate, while This is Money readers have also complained that it is difficult to see the rate of interest paid on Santander accounts.
Why does Santander make it so difficult to find your rate
There have been five issues of the Santander's esaver account, all of which pay varying rates of interest.
When customers sign into their online banking facility, it just says ‘Santander esaver’ without revealing the issue number, or interest rate.
The screenshot below shows a This is Money reader's online banking account.
He has three esaver accounts, but cannot at a glance see which account is paying what rate of interest, all that is shown is ESAVER and an account number and sort code.
But that hidden savings rate is highly important because Santander's use of bonuses means the accounts could be earning next to no interest.
Santander: One This is Money reader has three different esaver accounts – yet there is no information about which issue number each is, the rate, or the date it was taken out
Santander savers sitting on a rate of 0.1 per cent
To find out the rate on your Santander esaver, you need to call the bank, pop into a branch or sift through confusing tables of data linked to in a PDF file on its website.
Here is what we unearthed after some sleuthing.
The esaver1 was launched on 1 April 2009 and the rate included a bonus. The bonus fell away after a year so savers with between 1 and 200,000 in the account now earn just 0.10 per cent interest.
Other variations of Santander's esaver also have bonuses that may have dropped off.
Those on an esaver2 or 3 will also have seen the bonuses fall away from their account, and are likely to be sat on a rate of just 0.5 per cent.
The esaver4 was launched on the 19th August 2011, so the bonus will still be intact on the 3.1 per cent paying account.
The latest account, the esaver5, paying 3 per cent was launched just last month.
Despite this being a theoretically simple online account, it is clear that it is not easy for savers to find out their rate of interest from Santander.
Anna Bowes, director of Savings Champion, says that it’s about time banks and building societies, including Santander, made it easier for savers.
She said: 'It is essential to see the interest you are getting and Santander are not making it easy for customers.'
What Santander has to say
So why does the bank seem to make it difficult for savers to find the rate of interest on esaver accounts
Santander did not explain why it does not clearly display the interest rate online, but a spokesman gave This is Money the following statement:
- We write to all customers at least 60 days before the bonuson their account matures.
- All our rates are available on our website, in our branchesand by phone.
- We also include customers' account name (including issuenumber) and their interest rate on their annual statements if they receive one(this applies to both paper statements sent in post or the pdf versionsavailable in online banking if customer has opted for paperless statements).'
This is Money Online Rate Honesty campaign
This is Money believes it is not too much to ask for your online statement to show what savings rate you are being paid, even if this is just updated once a month.
Over 20million people use internet banking in Britain today, with many checking their accounts on a weekly basis.
We have been putting pressure on banks and building societies to become more transparent when it comes to savings rates.
Companies often excuse the apparent lack of transparency by saying: ‘We have written to the customer to tell them of the bonus coming to the end’.
But as savers, and people in general, get more used to conducting their affairs on the internet surely it would make more sense to clearly display the rate on account online.
It is also clear to us from our readers' comments – and our own savings accounts – that these vanishing bonus warning letters are not always as clear as banks like to maintain they are.
Back in January, Natwest and RBS backed our campaign and agreed to put savings rates on all paper and online statements [read the full story].
And others have followed suit. Greener123 from Southampton in the comments section of the NatWest/RBS article, said: 'All of Lloyds savings accounts show your rates online, you just have to click on the account then on view interest rate.'
Dutch-owned ING Direct also shows the rate of interest currently being earned, as per the screenshot below:
ING Direct: The online facility shows the amount of interest currently being earnt on your savings
Will Santander start showing savers their rate
So will Santander follow suit and start showing its savers what they are being paid
The spokesman added: 'We will shortly be updating account names in online banking to include issue numbers.'
But it appears there are no plans afoot to print your savings rate next to that account information.
HAVE YOU SAY: Are you a Santander savings customer Do you find it difficult to find out your current savings rate
Do you have a savings account elsewhere which doesn’t display your rate Or are you with a provider that makes it clear
We would love to hear your responses below…