"Businesses requiring flexible access to cash face penalties due to low interest rates, averaging just 1.54%. SMEs particularly struggle amidst the need for financial resilience."
"Lightyear's analysis reveals that businesses could lose out on approximately £8,000 in interest over five years by using instant access accounts instead of 95-day notice accounts."
Lightyear's analysis indicates that businesses with a need for flexible cash access are negatively impacted by low interest rates. The average interest rate for instant access accounts among major banks is merely 1.54%, which falls short of inflation rates. This poses particular challenges for SMEs, who often need liquidity for operational needs. Although notice accounts offer better rates, they impose lengthy lock-in periods, making them unattractive for many businesses. New alternative products from challengers, like Lightyear’s business account, aim to provide better flexibility and returns.
Read at London Business News | Londonlovesbusiness.com
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