Rate rises put consumers off switching

Interest rate increases since January have impacted on consumers’ propensity to switch financial products such as credit cards, it has been found.

A survey conducted by MoneyExpert discovered that 54 per cent of the population did not alter any of their financial products in the second quarter of the year - up from 49 per cent in the year’s first quarter.

According to Sean Gardner, chief executive of MoneyExpert, this trend is a direct result of heightening consumer caution following on from the interest rate rises effectuated by the Bank of England’s monetary policy committee this year.

"The financial squeeze caused by higher interest rates has meant consumers are more inclined to stick with what they know and in any case providers are getting tougher.

"The reality is that consumers are battening down the hatches in preparation for a rough ride as the mortgage becomes more expensive and disposable income reduces. It seems we’re all taking stock of our finances - and perhaps switching is an unwelcome distraction in the current climate.

"However there are still plenty of ways to save money and we would urge consumers to continue to seek out the best deals."

Interest rates currently stand at 5.75 per cent - the highest level for six and a half years.