Susan Allen

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millions of people with Santander popular checking account face a cut in interest rates in the midst of changes for savers and borrowers.

The Bank has announced that from 5. In may, the interest, 1 should be cut on balances up to £20,000 in their account 123. 5% to 1%.

The Move has to describe a commentator to the account as a "dead duck" for savers.

in the case of Santander has in the setting of a 39. 9% overdraft rate.

This will take effect on 6. April and in response, developed to protect the consumer.

How will be affected the savers?

Between March 2012 and November 2016, which earns up to € 20,000 in your account 123 with a 3% savings interest rates in the year. This, in addition to some major marketing, it causes a wide variety of clients to sign up for the account.

The rate dropped to 1. 5% and, from may, falling by 1%. Cashback benefits at the household and electricity bills are also less generous. The account fee of £5 per month remains.

Susan Allen , head of retail banking at Santander, said: "Although we have had to make some difficult decisions, the area remains in the current environment, our current account is very competitive. "

But Martin Lewis , founder of money saving expert, described the bill as a "dead duck" for savers.

"There is little reason to stay for anyone. In may, he reduce interest rates to 1%, which is significantly less interest than The Top -paying easy-access savings. The irony is that, until this announcement, Santander 123 was ready for a comeback as [the interest rate] was looking good again," he said.

Most People will pay the current accounts little or no interest, and savings accounts have falling prices, have in the last few weeks. The Best easy-access rates are currently about 1. 4%, in the midst of a low interest economic environment.

What has happened to the cost of an overdraft?

The Financial Conduct Authority, The City watchdog, is to shake the planning to the "dysfunctional" overdraft market, pausing by banks and building societies from higher prices for unarranged overdrafts than arranged overdrafts.

The new rules into force in April, require providers to charge a simple annual interest rate for all overdrafts and to get rid of the fixed fees.

The result has been the accumulation in banks and building societies - at most, the setting of a rate that is very close to 40%.

that would mean That someone who borrowed £100 as an overdraft for a whole year would pay for, £40 to The Bank for the service.

nationwide, HSBC and RBS all have their rate to just over 39%, Barclays setting the rate at 35%.

The majority of customers, especially those with an unarranged overdraft, not better, under these prices, but some of you had arranged would be your overdraft, worse off.

"We have a number of support services are in place - from our over-the-phone experts, our in-store workshops and would encourage customers to help in the understanding of the impact of these changes, or any other aspect of the management of their money, to come in contact with," Ms All.

uk banking, personal finance, santander group, personal debt, money

Source of news: bbc.com