We name and shame the worst savings accounts with banks paying 0.05%

SAVERS need to watch out for banks and building societies paying as little as 0.05 per cent on their hard-earned cash.

New data from comparison site Moneyfacts reveals that there are four easy-access accounts open to new savers that pay as little as 0.05 per cent.

That means you'd earn a minuscule 50p on savings of £1,000.

The providers paying these ultra low rates are Al Rayan Bank, Bank and Clients, Darlington Building Society, and Vernon Building Society.

That's even more than the three accounts paying this rate when we checked earlier this year.

But they're not the only ones, other banks are paying just a smidgen more at 0.1%, and this includes major players such as HSBC and Nationwide.

This means you'd be paid just £1 in interest on £1,000 saved.

In comparison, the top easy-access savings accounts from Virgin Money and Cynergy Bank pay 1.5 per cent.

That's £15 on your £1,000 savings pot – still not a huge amount but much better than a pitiful rate of less £1 or less.

How to find a top savings account

USE a comparison service to decide which account is best for you.

It's worth noting that you can earn more in accounts that lock your cash away for a set period of time.

But if you want to get hold of your cash then an easy-access account is best. To help, we've rounded-up the top easy-access accounts in the table below.

You may also want to weigh up whether to use an Isa instead, which is a tax-free savings account – although interest of up to £1,000 is tax-free anyway for basic rate taxpayers.

Higher rate taxpayers get a £500 personal savings allowance, although additional rate tax payers don't get anything.

Check out our round-up of the best savings accounts and the top Cash Isas.

The findings come a year after the Financial Conduct Authority (FCA) floated the idea of forcing banks to offer minimum savings rate to customers to treat all savers fairly.

It said this basic savings rate would apply to all easy-access cash savings accounts after they have been open for a set period of time, such as a year.

But the regulator is yet to announce a final decision on its plans.

Rachel Springall, finance expert at Moneyfacts.co.uk, says savers with a low-paying account should consider switching to a better deal.

She said: “Clearly, a huge difference in the interest offered to consumers across the most familiar brands remains, despite the FCA’s price discrimination study 12 months ago, which is why savers should consider switching to a better deal.

“As murmurings of a base rate cut persist, variable rate accounts will be the first type of savings accounts to see rates worsen, and the last two years of base rate rises will likely quickly unravel as a result – so there is even more reason for savers to shake off any apathy or loyalty and switch elsewhere.”

The Sun has contact the four providers paying 0.05 per cent – but Darlington Building Society and Vernon Building Society are the only ones to respond at the time of publication.

Darlington Building Society's chief executive, Andrew Craddock, said: "The Society considers various factors to determine the interest rates on our range of savings accounts to ensure that we have products available for our members to meet their needs and encourage saving.

"Our overall range remains competitive and provides members with the choice to select the account that most suits them.

"We encourage our members to review their accounts on a regular basis and we ensure that the interest rates on all our products are publicised and available at all times."

A spokesperson for Vernon Building Society added: "Our instant access account caters for our members who want access to their money with no restrictions for withdrawing or paying in to their account.

"We offer multiple savings accounts currently paying up to 2.85 per cent depending on our customers' needs."

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