The cuts have dealt a fresh blow to savers, with existing customers being affected in the next few weeks. The announcement for Marcus and Saga customers comes in the same week as NS&I announcing major rate cuts for Premium Bonds and other savings accounts.
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In May this year, other big savings acorns such as Santander 123 and TSB’s Classic Plus will also be cutting interest rates.
Helen Saxon, banking editor at MoneySavingExpert.com, said: “These latest rate cuts from Marcus and Saga will be a further blow to hard pressed savers, who – again – are left scrabbling around to get a return on their money.
“But, the cuts also serve as a very clear reminder to everyone with a savings account to check what rate they’re getting.
“See 1.3 percent as the minimum you should be getting on easily accessible savings, then look for other options – perhaps fixed savings or higher rates with current accounts – to maximise your interest.”
READ MORE: Premium Bonds: NS&I slashes interest rates
Marcus and Saga savings accounts interest rates have been cut (Image: GETTY)
Saga confirmed the announcement to Express.co.uk, explaining that the interest rate on the Saga Easy Access Savings Account had been reduced to 1.30 percent AER variable, including a 12-month bonus rate of 0.2 percent.
Saga said it would be writing to existing customers to give them at last 14 days’ notice of this change.
It would be effective for these customers from March 10, 2020.
However, the change is effective immediately for any new customers who open an account on or after February 19, 2020.
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Meanwhile, Marcus by Goldman Sachs’ Online Savings Account now offers an interest rate of 1.30 percent AER variable.
The interest rate has change from 1.35 percent, and the change is effective immediately for nay new customers who open an account on or after February 19, 2020.
Existing customers will receive direct correspondence with at least 14 days’ notice of this change, and this will be effective for them from March 10, 2020.
The minimum savings in this easy-access savings account is £1, while the maximum is £250,000 plus interest – with £85,000 of this falling under FSCS protection.
Marcus and Saga have cut interest rates on savings accounts – savings in pictures (Image: GETTY)
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The popular Marcus savings account launched in September 2018, and at the time had a market-leading rate of 1.5 percent – which includes a 0.15 percent bonus.
However, since December, it has offered 1.35 percent without the bonus.
Meanwhile, the interest rate changes to fixed and variable savings products announced by NS&I will be effective from May 1, 2020.
Ian Ackerley, NS&I Chief Executive, said: “Reducing interest rates is always a difficult decision. We need to ensure our interest rates are set at an appropriate position against those of our competitors.
“These changes reflect NS&I’s requirement to strike a balance between the needs of our savers with taxpayers and the stability of the broader financial services sector.
“We believe our new rates offer our customers a fair return and the assurance of the 100% HM Treasury guarantee on all their holdings with NS&I.”
Amid the news, some people may wonder how it will affect the Premium Bonds prize draws.
The Premium Bonds prize fund rate will reduce by 10 basis points, from 1.40 percent to 1.30 percent.
This means that from the May 2020 prize draw, the odds of any £1 Bond number winning any prize will decrease from 24,500 to one to 26,000 to one.