Building societies ‘provide incentive to save’

Savings with building societies are currently at a “very high level”, according to the Building Societies Association (BSA).

The organisation reports that a number of factors have added to this trend, one of which it identified as the Northern Rock crisis.

Neil Johnson, PR and policy manager for the BSA, explained that savers with the bank have continued to withdraw their money and look for places they think it will be safer.

In addition, good interest rates and high quality products are encouraging people to save with building societies, he added.

“Thirdly there is the worsening economic forecast causing people to start to think about where their finances are going this year and people are perhaps thinking that they need to save a little bit,” Mr Johnson concluded.

In November 2006, building societies had net receipts of £848 million. The BSA reports this figure rose to £2,348 million by November 2007.

© Adfero Ltd

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