Ethical brands often beat big banks for savings returns, analysis finds

Savers can potentially earn more money by opting for ethical brands, analysis has found.

Many ethical brands continue to offer higher returns than traditional high street banks, Moneyfacts.co.uk found.

It also said savers looking for a slightly higher rate in return can also find ethical brands paying decent returns on notice accounts.

Moneyfacts carried out the research to mark Good Money Week (October 24-30), which helps savers to find ethical and sustainable options.

Rachel Springall, a finance expert at Moneyfacts.co.uk, said that ethical brands state what they give back to the community.

She added that the rise of Islamic banks, which pay an expected profit rate, has had a positive impact on the savings market and ignited competition among challenger banks.

In recent weeks, building societies have also introduced lucrative offers to the market for savers, she added.

Rachel Springall, a finance expert at Moneyfacts, said: “The Bank of Scotland access saver, Barclays Bank’s everyday saver, the Halifax everyday saver, HSBC’s flexible saver, Lloyds Bank’s easy saver and the NatWest/RBS instant saver all pay just 0.01% today.

“As an alternative, Gatehouse Bank’s 0.75% expected profit rate would mean a difference of £148 based on a £20,000 deposit over one year.

“Ethical brands can offer decent returns on notice accounts too but, due to challenger bank competition in this sector, savers would be wise to compare rates carefully.”

Moneyfacts highlighted other ethical easy-access options, such as a 0.70% expected profit rate from Al Rayan Bank, a 0.30% deal from Triodos Bank, and a 0.20% deal from Ecology Building Society.

Ms Springall added: “No-one knows what may lay ahead for consumers in the months to come, but an ethical brand may be a good choice not only for their principles, but for savers who want quick access to their money and a better rate than with a high street bank.”