The FCA has published its latest analysis of fair value in the cash savings markets. Key highlights are:
- average interest on easy access savings accounts rose from 1.66% last July to 2.11% in June 2024;
- while firms were benefiting from increased base rates, they were increasingly passing on the benefits to savers;
- customers should still shop around, as there are many account offering over 4% interest while the bigger firms continue to offer poorer value;
- the FCA will closely monitor activity as the base rate falls; and
- there is room for firms to improve how they assess the value their savings products offer.
The FCA does not intend to provide any further updates unless it finds any significant concerns in the future.
Alongside the review, it has published an update on how firms across the sector have assessed their products and services against the price and value outcome of the Consumer Duty – and has focused on cash savings as well as GAP insurance and cash on investment platforms. The review makes some points that should be useful to all firms, giving guidance on factors that may suggest a problem in pricing and fairness, while reminding firms not to look in a siloed way at any outcome. It also reminds firms to take appropriate action if they identify that customers are not receiving fair value, and gives examples of good and poor practice.