Bank bail-out: The effect on bank customers
Banks don't just serve savers – they offer a range of other financial products such as current accounts, loans and credit cards. While savings rates remain high, and profitability low, customers will not get such competitive deals in these areas.
"In the current-account market," says Michelle Slade of Moneyfacts, "the top two positions are held by Alliance & Leicester and Abbey, but with these two banks now part of the same group, it is likely that rates will change on at least one of these accounts. We have also seen the likes of Barclays and HSBC removing credit interest entirely on their standard accounts. As the banks now look to recoup lost revenue, it will no doubt be customers who pay the price through reduced credit interest and higher overdraft rates."
Those who have got used to easy credit – be it by moving a large balance from one zero per cent credit card to the next, or by consolidating existing credit-card debts into a low-cost loan – are also in for a rude awakening.
Banks have been forced to tighten their lending criteria – this means cheap credit cards and loans are fast becoming rarer than hen's teeth. Those with previous credit problems are unlikely to be offered new cards or loans at all, meaning many people will be forced to pay interest of about 20 per cent on credit-card debts.
