- The average interest rate SMEs receive on surplus funds is 0.60 per cent;
- More than eight out of ten (81%) SMEs hold their business savings account at the same bank as their business current account;
- 42 per cent of SMEs receive between 0 – 0.5 per cent, 14 per cent of these receive 0 per cent;
- Almost one in five (18%) admit they never review their accounts with only one-in-ten (10%) SMEs review their accounts more than once every six months.
New research from Aldermore shows more than a third of small and medium-sized enterprises (SMEs) (34%) don’t know what interest rate their business is currently receiving on their surplus funds. A further 14 per cent admit their business receives 0 per cent interest.
The research, which surveyed more than 1,000 British SMEs and follows a similar survey to last year, also shows more than eight in ten (81%) SMEs who have a business savings account hold it with the same provider as their business current account.
The survey also found that SMEs aren’t reviewing their savings as regularly as they did last year. This year’s survey found that 55 per cent of businesses review their accounts at least once a year, compared to 62 per cent in 2015. Interestingly, almost half (47%) feel the potential returns aren’t worth the effort meaning many SMEs are simply not shopping around to get the best deal or find the process too much of a hassle.
Of those businesses with surplus funds, almost half (46%) hold the majority of their surplus funds in a business savings account, with just over a further third (34%) keeping their funds in a business current account. The most recent figures from the BBA shows cash held by SMEs in current and deposit accounts totals £163.5 billion*.
Commenting on the research, Simon Healy, Managing Director of Savings at Aldermore said:
“Business savings play an important role for SMEs in covering unexpected bills, future investment and general cash flow. It is therefore important businesses make the most of their money and shop around for the best rate. While it is understandable that SMEs prefer to keep their surplus funds with the same provider as their business current account, in reality they are not making the most of their hard earned money.
“Opening a business savings account can be hassle free, at Aldermore you can open one within 15 minutes. Our business savings rate checker service allows SMEs to quickly establish if there is a better home for their surplus cash without the need to change their business current account.”
For further information, journalists can contact:
Rachael Snelling, Aldermore
Phone: 0208 1853 102
Adam Taylor, Cicero Group
Phone: 07557 965958
Notes to Editors:
All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1,008 Small Business Decision Makers. Fieldwork was undertaken between 4th - 12th April 2016. The survey was carried out online. The figures have been weighted and are representative of business size (number of employees).
* BBA Bank support for SMEs – 4th Quarter 2015 data can be found here.
Aldermore Group PLC is a specialist lender and savings bank offering straightforward products to Small and Medium-sized Enterprises (SMEs), homebuyers and individuals, who we believe are often under- or poorly served by the wider market. Aldermore has no branch network but serves customers and intermediary partners online, by phone and face to face through its network of regional offices located around the UK. Building on its core values of being reliable, expert, dynamic and straightforward, Aldermore aims to deliver banking as it should be. Established in 2009, Aldermore has grown significantly. At the end of December 2015, lending to customers stood at £6.1 billion and customer deposits totalled £5.7 billion. For more information, please visit www.aldermore.co.uk.
Aldermore Bank PLC is an operating entity of Aldermore Group PLC. In March 2015, Aldermore Group PLC’s shares (ALD.L) listed on the Main Market of the London Stock Exchange. Aldermore Bank PLC is regulated by the Prudential Regulation Authority and the Financial Conduct Authority and is registered under the Financial Services Compensation Scheme.