Easy access account balances climb 10% as market growth continues

The average easy access non-ISA balance has risen by 10% year-on-year, as the easy access market continues its upward trajectory.

Data analysed by Paragon Bank showed that easy access non-ISA balances have increased from £9,995 to £10,989 to in a year.
 
The figures also showed that the easy access market value increased by £53.5bn last year, accounting for 97% of the savings market growth within that period.
 
While the easy access market grew from £496.5bn in January 2020 to £550bn in November, the total savings market increased by around £55bn in that time.
 
Easy access non-ISA products now account for 58% of the total savings market – which Paragon highlighted is by far the largest market share of any product type. Instant access ISAs account for 19% of the market, while fixed rate non-ISA products account for 9% of total savings. 
 
Despite this increase in average balance over the course of last year, Paragon’s analysis found that 38% of all easy access savings accounts still hold a balance of between £1 and £100. However, the number of accounts with balances under £500 has decreased in 2020, with accounts holding balances of more than £500 increasing, suggesting people have chosen to save more as a result of the pandemic.

“As the third lockdown continues, a significant number of Brits are still seeing their expenditure go down considerably as they spend more time at home, and this is leading to record breaking savings,” commented Paragon savings director, Derek Sprawling.

“However, this means that many savers aren’t receiving the most competitive rate of interest available. In fact, data shows that close to three-quarters of easy access balances now earn a rate of 0.1% or less, amounting to a total of £403bn’s worth of savings.

“Splitting funds between an easy access ‘rainy day’ fund and a fixed rate is a good solution for those looking to have access to money in the event of an emergency, while also ensuring they get a competitive rate on a portion of their savings.”

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