The Money Stop

Consumers who open an instant access account should be aware that although they can withdraw their money without notice, some banks will charge them for doing so, according to a financial analyst.

Michelle Slade of Moneyfacts, a personal finance website, has said that as many as one in four banks charge their customers hidden penalties for taking money out of an instant access and no-notice savings account.

Last month, Nationwide published research on savings accounts which showed that 84 per cent of consumers believe there should be no penalty for withdrawals and 54 per cent say it is very important or essential that there is a no-notice period.

Ms Slade says: “The term ‘instant access’ is not misleading, but some would say that they should not really be charging a penalty just for you taking your money out, especially as some of the charges really are quite high.”

According to the analyst, some accounts either reduce the interest or do not pay it for the month in which a withdrawal is made.

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