The UK’s Financial Conduct Authority (FCA) has reprimanded the country’s four major banks for setting their saving rates too low, to the detriment of customers. While the Bank of England recently raised its interest rate from 4.5% to 5%, there is no excuse for banks to continue offering such meager returns on savings to their clients. HSBC, Natwest, Barclays, and Lloyds are the 4 major banks in question here.
Paltry Returns on Savings
When the FCA publicly chastises major UK banks for offering their clients easy-access saving rates between 0.7% and 1.35%, it becomes clear how poorly banks treat their customers. According to Reuters, top executives from these banks have been invited to the FCA to discuss the issue.
A source close to the FCA stated: “We think there is more value to offer consumers, we are not satisfied with some of the lowest saving rates we see, and we want banks to support their customers… and for people to be able to make informed choices.”
Inflation-Proof Alternative
With inflation remaining at 8.7% for the second consecutive month, consumers are struggling. Food inflation is around 30% and with an average 5-year fixed mortgage rate above 6%, the UK economy is starting to scream. In this kind of environment, it is completely unacceptable for banks to only seek to protect themselves. These banks are deemed too big to fail and will be bailed out if they reach the point of collapse.
So the question arises: why would anyone with spare money put it in a bank? The official inflation rate of 8.5% is well over 10% if you take into account how the items included in inflation are manipulated over the years. Therefore, receiving around 1% for savings that are losing around 10% per year makes no sense at all. Banks can only get away with this due to people’s ignorance of how they can best deploy their savings.
It is in this context that Bitcoin has increased by over 100% since the beginning of the year. There is no guarantee that this will continue, and there is a lot of volatility in what is still a very small asset class. However, the investor must make a choice between a fiat currency that will go to zero with 100% certainty, and Bitcoin, which is the rarest and safest asset in the world. Anyone considering making this choice should fully educate themselves on the matter. For that, there are platforms like cryptoview.io that provide detailed and up-to-date information on the cryptocurrency market.
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