Get paid, not played
02 June 2023
Half of UK adults have never switched savings provider, as high street banks take advantage of loyal customers
- Research conducted by Atom bank finds that three quarters of UK adults say they would switch for a better savings rate, but half have never done so
- Savers say they want an additional £150 a year to switch but can actually earn over £200 by ditching the high street banks
- A quarter believe switching providers is too much hassle, despite it being easier than ever to switch
- Atom analysis of big bank Q1 results points to increasing profit at the expense of savings customers, despite increasing pressure from the FCA and Treasury Select Committee.
Atom bank has today (2 June) released new research1 as part of its “Get paid, not played” campaign that encourages big banks to offer fairer rates on easy access saving products and educates people on the ease of switching savings providers to secure a better rate.
The study reveals that half (49%) of UK adults have never switched savings provider before, despite analysis showing savers could be over £200 better off a year if they switched their savings to challengers like Atom2. The findings suggest there is a clear need for further awareness around the financial benefits of switching providers, at a time when switching is easier than ever before and inflation continues to erode people’s hard earned savings.
What would it take to switch?
Three quarters (76%) of UK adults said they would switch savings providers for a better rate, needing on average an extra £150 interest a year before moving. Atom analysis shows that a saver could in fact earn an additional £227 a year in interest if they were to switch from one of the high street banks’ easy access products to a challenger like Atom paying a fair rate.
Despite the extra money available to savers, half have never switched their savings providers before. This is in part due to the perception that the process of switching is challenging, with almost a quarter (24%) saying that they haven’t switched because it is too much hassle. Among those who have switched savings providers before, the majority (21%) do so only every two-to-five years, meaning they may have missed out on top deals since the Bank of England began increasing the base rate. This is despite the fact that shopping around and opening an easy access saver account today is fast, easy and, in the case of Atom, without any hidden catches.
The financial benefits of being proactive and switching providers to secure better rates is significant. Atom found that those who have switched providers have, on average, more than triple the amount in savings than those who haven’t switched before (£17,501 vs £4,001).
High street lenders taking advantage of loyal customers
The Bank of England base rate currently stands at 4.50%, after 12 increases in a row, yet the rates offered on money in big bank easy access savings accounts lags behind. The Treasury and the FCA have both openly criticised the approach of the banks, with MPs on the Treasury Committee stating that “they are taking advantage of their most loyal customers to increase profits and CEO pay”3.
Separate analysis from Atom further backs this up, showing that the big five banks posted combined profits of over £5 billion in the first quarter of this year, a 43% increase on last year. The data shows that the majority of this jump in profits was a result of the banks increasing their margins at the expense of savers4.
Mark Mullen, CEO at Atom Bank, said: “The big banks are making a fortune by not passing on rate increases to savers. We think savers should be getting paid, not played by their bank.
“It’s encouraging that the Treasury Select Committee and the FCA are challenging this behaviour but by far the best way to stop them profiting at the expense of customers is to encourage people to get online, vote with their fingers and move their hard-earned money to a better rate.
“Let’s not forget, most savers are covered by the FSCS for sums up to £85,000 and have absolutely nothing to gain by remaining loyal to “so called safer” banks that pay them derisory savings rates. We need to drive better awareness and competition in order to turn the dial on this issue.
“The myth remains that switching banks is a time-consuming and difficult process. Savers today have the best rates at their fingertips, and just a few clicks on a decent app can earn them an extra few hundred pounds a year. The sooner people realise this, the sooner big banks will be forced to change their ways.”
Notes to editors
1Research was conducted between 21st-25th April 2023 with a nationally representative sample of 2,000 UK adults
2Atom analysis of average easy access rate at Barclays, HSBC, NatWest, Lloyds, Santander, TSB, Virgin Money and Nationwide (0.88% gross) v Atom bank (3.15% gross) on a balance of £10,000 = £227 per annum difference (correct as of 24 May)
4Analysis conducted by Atom bank following Q1 results of high street banks
|Profit before tax||2.3||0.8||0.8||0.6||0.5||5.0|
|Estimated Banking NIM||3.22%||2.99%||3.18%||2.92%||2.20%||2.91%|
|Change in Banking NIM||0.54%||0.56%||0.56%||0.57%||0.23%||0.48%|
|Change in Loans||0.5||17||0.9||-2.9||1.8||25.5|
|Change in Deposits||-8.0||-5.7||-6.0||-15.0||0.7||-22.1|
Atom Instant Access Saver summary
For more details journalists can contact:
Ed Shelley, firstname.lastname@example.org 07825 427522
Sorcha Hornett, email@example.com 07811 064 468
Robbie Steel, firstname.lastname@example.org 07538 775 701
About Atom bank
Atom bank is the UK’s first app-based bank, on a mission to make the experience of borrowing and saving faster, simpler and better value than anyone else.
The bank launched operations in April 2016, and offers award-winning mortgages and savings through its app, alongside secured business lending for small and medium-sized enterprises.
Based in the North East of England with a team of over 470 people, Atom is here to change banking for the good, for the better, and for everyone. This means focusing on customers’ needs, delivering better value than the incumbents, providing an exceptional app-based experience and offering award-winning customer support via phone, chat, email and social channels.
Based in Durham, Atom is an engaged and active member of the North East Community. In 2022 Atom signed a five-year Memorandum of Understanding with Durham University to progress key research and diversity initiatives. The region has one of the highest levels of youth unemployment in the UK and Atom is passionate about addressing the critical digital skills gap and helping develop young people and other groups that are under-represented within the industry.
As of November 2021, all employees enjoy a four-day working week, after Atom became the largest company - and only bank - in Britain to introduce the policy, with no reduction in salary.
The Atom executive team are highly experienced, having built and run some of the most well-respected banks in the UK. CEO Mark Mullen has 30 years’ experience in the sector and was previously CEO at the multi- award-winning telephone and internet bank first direct. The team is supported by a strong non-exec board, chaired by Bridget Rosewell CBE.