Research: 99% of companies unhappy with business account rates

Research has found that almost all firms are unsatisfied with their business account rate.

Many organisations may wish to compare savings on business banking options in the near future, new research has suggested.

According to a study conducted by the Fair Investment Company (FIC), which was published yesterday (November 18th 2010), almost all firms across the country are currently unsatisfied with the conditions of their business account.

The investigation revealed that 99 per cent of companies are unhappy, as the average business banking savings rate is just 0.48 per cent in the aftermath of the global economic downturn.

Julie Smith, head of savings at the FIC, commented that these figures came as "no surprise", because 33 per cent of business accounts available in the UK pay 0.1 per cent interest.

Meanwhile, research by Investec has found that 36 per cent of companies are not saving at all due to these unattractive rates.

This comes after Cater Allen earlier this week launched a new business account with a gross annual equivalent rate of three per cent.

Cater Allen - part of the Spanish financier group - has launched a two-year term deposit especially for firms, which pays a gross annual equivalent rate of three per cent.

Both new and existing clients of the lender are eligible to take out this account - as long as they have a minimum initial deposit of 50,000 - while customers are also offered the flexibility of being able to choose whether they receive their interest monthly or annually.

Jackie Brown, head of banking and savings at Cater Allen, remarked the product has been designed to "appeal to clients looking for a fixed rate of interest and the security provided by a guaranteed return".

Meanwhile, it was announced last week that companies with business accounts from the Royal Bank of Scotland and NatWest can now access their products through the Post Office.

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