On 6 December 2023, the FCA published an update on the cash savings market for December 2023.
The update follows the 14-point action plan set out by the FCA in July 2023 in its review of the cash savings market. The action plan aimed to ensure that banks are building societies are:
- Passing on interest rate rises to savers appropriately.
- Communicating with customers much more effectively.
- Offering better savings rate deals to customers.
In the update, the FCA sets out how the market has developed since then, as well as where firms need to continue to make progress towards the consumer outcomes we expect. We expect to see continued improvements from firms. It is intended to deliver on the FCA’s commitment to monitor relevant firm and market trends, including setting out higher and lower easy access rates on the market and analysis of the speed and degree of base rate rises being passed on to savers.
The FCA highlights that it has seen some indications of a more competitive cash savings market emerging, with higher rates being paid to savers and data indicating people are moving their money to take advantage of them. Furthermore, the FCA notes that from July 2023 to October 2023, both the volume of deposits held in bank and building society non-interest-bearing accounts and easy access accounts reduced by £11bn, while deposits held in fixed-term and notice accounts increased by £17bn.