Banks 'must pass on savings to customers'

High street banks must pass on savings to their mortgage customers after the biggest base rate cut in more than 25 years, it has been claimed.

According to the National Association of Estate Agents (NAEA), the ball is firmly in the court of the banks following the monetary policy committee''s decision to knock 1.5 per cent off the interest rate – taking it to three per cent.

"We are calling on all of the major lenders to commit to passing these savings onto the consumers," the NAEA said.

Adding: "That will help hard working families ... [and] young people looking to buy their first property."

The group said the rate reduction could boost consumer confidence and address the increasing problem of repossession.

According to the Bank, the cut was made to address the "very marked deterioration" in Britain''s economic outlook, which is pushing the country close to a recession.

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