Nearly 2.5 million adults in the UK have already taken up an offset banking offer, according to new research by ICM for direct bank Intelligent Finance.
The research, which is based on telephone interviews with over 1000 UK adults, forecasts a sizeable rise in the popularity of the offset banking principle which allows consumers to offset interest charges on their borrowings against savings.
According to ICM, a further ten million UK banking customers who don’t currently offset their accounts would consider switching to a bank that offered such a service.
Grenville Turner, IF chief executive comments: "In a climate where returns on savings in traditional accounts are low, the burden of taxation is rising, and the stock market is in a prolonged slump, offset banking gives people the opportunity to make their money work far harder for them. It’s small wonder that offset banking is quickly catching on."
However, only a quarter of those interviewed are aware of offset banking, a 50% increase on a year previously but still some way short of the numbers required to force a big change in banking habits.
IF - which has built its business around the offset principle - notes with satisfaction that ABC1’s are significantly more likely to be aware of offset banking than the population at large, with nearly one in three understanding the concept.
The bank says that offset banking particularly appeals to this group and to the next generation of banking consumers - 18 to 34 year olds - and homeowners. Some one in three of each of these groups say they would consider changing their bank to take advantage of of offset banking rates.