- Savings deposits held by CACI member institutions increased as UK entered recession, Paragon Bank analysis finds
- Total deposits increase by £10 billion to £1.01 trillion, with non-ISA deposits topping £750 billion for first time
- Overall savings increase follows Bank of England base rate rises, with the proportion of non-ISA accounts offering less than 0.5% interest falling from 82% to 78%
Savings deposits held by CACI members increased to £1.01 trillion as the UK economy entered recession, new analysis by Paragon Bank has found
The increase in total savings followed a £10 billion month-on-month increase in the overall value of non-ISA deposits, totalling over £750 billion for the first time (£750.03 billion).
Following rises to the Bank of England’s base rate, the proportion of Instant Access non-ISA accounts offering less than 0.5% interest fell from 82% to 78% – totalling £392 billion of all such deposits.
Rising from £200 billion, the total amount held in Instant Access non-ISA accounts offering more than 0.5% climbed to £240 billion.
The overall amount held in ISAs fell marginally by £16 million.
The analysis of the latest data, covering October 2022 and comprising the deposits of 34 leading providers, also found that the proportion of Instant Access non-ISA accounts holding up to £1,000 remained steady at 55% – with 36% of all accounts up to than £100.
Commenting on the new analysis Derek Sprawling, Paragon’s Savings Director, said: “As the country headed towards recession, savers took notice – leading to a modest rise in the value of overall deposits, but there is more that they could be doing.
“Though the overall number of open accounts offering less than 0.5% fell to 77%, it is concerning that the overwhelming number of accounts are not receiving the return that savers deserve.”
He continued: “With strong returns available from savings products provided by specialist banks, savers need not wait for Bank of England Base Rate rises before they see improved rewards on their hard-earned money.
“Rather than wait to see what the Bank of England decides, specialist banks are anticipating changes. Accordingly, I urge savers to take advantage of what is currently available and not delay their making the right decisions for their financial circumstances.”