Charities suffering low savings interest rates

Charities are receiving some of the lowest savings interest rates on the market, it has been reported.

According to the Fair Investment Company, the average rate stands at 0.45 per cent, while the mean fixed-rate charity savings account is offering just 1.62 per cent.

The firm reports that the average rate is just over half as good as the average personal savings account.

"Charities really are getting a raw deal at the moment," said James Caldwell, director at Fair Investment Company.

"The average rate for charities is less than half a per cent, and even for those charities who can afford to fix, average rates are only 1.62 per cent. Personal accounts are not great at the moment, but the average fix is 3.05 per cent which is still considerably better than what charities are getting."

Mr Caldwell noted that charities are already feeling the pinch due to the economic downturn, and this problem is being exaggerated by the lack of earnings on savings that do exist.

Last month, the Fair Investment Company reported that charities have witnessed an 11 per cent drop in savings over the last 12 months.

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2010-05-18 13:43:55 © Moneyextra.com