Children's bank accounts attract record low interest rates
It has been revealed that the differential between a child bank account in the UK and an adult bank account has widened significantly over the term of the ongoing recession. Children's accounts are now paying as little as 0.05% (i.e. five pence on every £100 saved) while the same bank may well be paying £1.60 on each £100 saved for adult accounts.
It would appear that this differential is across the board with the likes of Barclays, Lloyds TSB, HSBC, Royal Bank of Scotland, Abbey and Cheltenham and Gloucester said to be offering very low savings rates to youngsters. The situation is made worse by the fact that children are barred from transferring money to adult savings accounts so effectively they have nowhere else to go.
At a time when money is tight around the UK and liquidity is vital within the UK banking system, it appears as though the UK banking sector has access to low finance funds, i.e. savings accounts held by children, which they can use to fund their wider business interests and grow their profits. When you consider that many of these children's accounts hold the £250 paid out by the UK government to each newborn in the UK there is concern that the system is just not working.
Share this..
Related stories
Are the days of private landlords numbered?
The ongoing demise in the UK buy to let property market has hit many private individuals very hard after a relatively lucrative last decade. While it's true that many individuals have made significant returns over the last 10 years there is a growing feeling that large corporations and large investors will swamp the sector in the short, medium and longer term. There are concerns that the so-called...
Read MoreLargest climate emission falls in 40 years
While the recession has had an impact on businesses and individuals around the world, a forecast fall of 2.6% in global carbon emissions would appear to be as a direct consequence of the recession. A significant reduction in business levels around the world and less "spending money" for individuals would appear to have led to what many governments were seeking, a marked reduction in damage to the...
Read MoreUK public borrowing balloons to record high
UK public borrowing rose to a massive £19.9 billion in May as expenditure remained fairly high and income tax receipts continued to fall. The combined deficit for April and May came to an enormous £30.5 billion with some experts suggesting this figure will rise further before eventually falling back. The fact that Alistair Darling has already admitted that the UK public borrowing deficit will re...
Read MoreIs inflation set to be a problem in 2010?
The revelation that of non-food store prices in the UK increased by 1.4% last month, despite the fact that the UK is currently in recession, has astounded many analysts. This places massive pressure on the rate of inflation which is set to rise above the government's target of 2% in 2010. An increase in inflation, at a time when UK consumers are still struggling to pay their everyday bills, would...
Read MoreWhat does 2009 hold for UK savers?
As we enter 2009 there has been much talk of tax incentives for UK savers who have seen their incomes decimated by the ever falling UK base rate. While base rates are currently at 2%, many savers are receiving substantially less than this and many accounts are offering only minimal returns. The short-term outlook is even worse for UK savers with interest rates forecast to go down to around 0% whic...
Read More