No visa required to access best savings rates

In a time that has recently seen another Premiership football club fall into foreign hands and the London Stock Exchange subject to a foreign take-over moneysupermarket.com has observed that foreign banks are causing a quiet revolution in the UK savings market.

Analysis from the price comparison website shows as many as nine foreign providers now offer competitively priced products – many of which are giving the UK banks a real run for their money. Indeed, the UK savings market changed dramatically three years ago when ING Direct launched. Suddenly there was an upset to the cosy status quo that had existed thus far between UK banks and building societies and since then we have seen a host of further foreign banks come into the UK and head straight for the savings best buys.

Presently top of the Easy Access tables sit ICICI Bank, from India, and Landesbanki, and Icelandic Bank, both offering 5.45%. Although ‘local’ outfits Birmingham Midshires, Bank of Scotland and Alliance and Leicester have had momentary periods as top ‘best buy’ prior to the Bank of England base rate change ICICI has been top rate for much of the year.

Fortunately it is not only the easy access accounts that have benefited. As our charts below show the foreign banks are strong in the notice accounts and fixed term bonds sectors.

Stuart Glendinning, managing director at moneysupermarket.com said: “This is a foreign invasion everyone with money to save can welcome. These new banks offer savers more choice, higher rates and also put pressure on the existing providers to raise their rates. The only losers are the UK banks and building societies.

“People are becoming more accustomed to switching financial products to ensure they are getting the best deal. Many will no longer put up with the sorry rates offered by their banks and building societies.

“Although some people may be nervous about putting their money with a company they’ve never heard of some peace of mind can be ascertained by checking if the bank is regulated by the FSA and participates in the Financial Services Compensation Scheme which, in the event of financial collapse guarantees 100% refund of the first £2,000 and 90% of the next £33,000.“