Charities: not worth saving? Average rate just 0.45%

Charities are getting some of the lowest savings rates on the market, with the average rate sitting at just 0.45% while the average fixed rate charity savings account has fallen from a measly 1.68% to an even measlier 1.62%.

Although savings rates are poor generally, it is charities that are getting the worst deal from providers; the average rate is only just over half as good as the average personal savings account.

"Charities really are getting a raw deal at the moment," said James Caldwell, director at Fair Investment Company. "The average rate for charities is less than half a percent, and even for those charities who can afford to fix, average rates are only 1.62%. Personal accounts are not great at the moment, but the average fixed is 3.05% which is still considerably better than what charities are getting."

"During tough financial times, charitable donations are inevitably one of the first things to go - charitable donations fell by £1.3billion (11%) last year. So not only are charities really feeling the pinch, but on the donations they do have, they are hardly earning any interest."

"Although we obviously cannot force banks to start offering charities a better deal, we can at least source the best deals on the market, which is what we have done with our new charity savings comparison service."

The service compares leading charity savings accounts and offers up to 4% on fixed rates.

"Even the lowest rates on our site are more than three times the average, so, if your charity is receiving low interest, it is worth taking a look at some of the deals we have - it could make a big difference," said James.

James says that many charities may not even realise how poor a deal they are getting on their savings, and many who are aware that their current savings solution is less than adequate may not know what to do about it.

"That's where we can help; our new service offers rates considerably higher than the average and provides charities with the much needed tools required to help them make more from their money."

Charity savings account provider Cater Allen Private Bank, part of the Santander group, is currently offering 2.20% on a one year term deposit account through the Fair Investment service.

Spokesman Michael Alabaster says the new Fair Investment service is invaluable to charities looking for a better savings deal.

"It is important for charities to ensure that they are being supported by their bank both through a quality of service and by helping make the most of their deposits. Fair Investment Company's charity savings service offers a valuable resource to help charities distinguish those banks that will go that extra mile for their clients."