When you deposit savings with Banks, Building Societies and even N.S.& I . they are required to quote you a gross and net interest rate in a standard way, the A.E.R. With fixed term products what they usually don't bother to tell you is that at the end of the term you are not able to get access to your money (+interest) without a further delay usually of many days as they like to put a cheque in the post. Some institutions will make a same day CHAPS electronic transfer for a fee, e.g. £25 if you ask. In any case this delay or fee reduces your return and in effect invalidates and reduces the quoted interest rate which has actually been misleading.

This problem has been given a public airing in recent years but nothing has been done. Its time these institutions were legally required to illustrate at the outset how the fee or delay in returning saver's money reduces the interest they receive on their loan to the institution.

Why is this idea important?

There are very many retired people trying to live on income from their lifetime savings. Interest rates on secure savings products the moment do not even compensate for erosion by inflation. It is particularly unacceptable in these times that they are also being mislead by this financial trickery. Banks etc must be made to be honest up front about the true rate of return to their many small private investors.

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