The Financial Regulator has urged holders of SSIA special savings accounts who want to put their money on deposit to look for the best interest rates, and to check terms and conditions.
Latest figures from the Central Bank show that Irish people hold more than €70 billion on deposit with banks and building societies. The regulator says much of that money is held in short-term deposit accounts or current accounts that earn little or no interest.
The regulator's consumer director Mary O'Dea said banks and credit unions were competing for billions of euro of SSIA money by promoting deposit accounts with higher interest rates.
She said interest rates were important, but people should also take the terms and conditions into account. 'In some cases, any breach of the terms and conditions could substantially reduce the interest you could earn,' Ms O'Dea warned.
She urged savers to ask how interest was calculated, how frequently money could be withdrawn and what fees and charges or other conditions applied. The regulator also said it did not make sense to leave large amounts of money in a current account as they paid little or no interest.
Ms O'Dea warned people that some deposit accounts paid headline-grabbing interest rates only on any lump sum, such as SSIA funds. 'You may not earn this same rate on any further amounts you save,' she said. She added that some deposit accounts were geared towards regular monthly savings and may not give the higher interest rate on a lump sum over a certain amount.
