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Savings accounts are once again in the eye of the storm. The competition watchdog BMA recently asked itself whether it would be better to abolish the fidelity bonus, so that it would be easier to compare saving formulas. But such intervention could have far-reaching consequences for savers.
Why is this important?
Savings accounts have been under fire for some time now. Initially there was criticism of low savings rates. The federal government even launched one-year government bonds in September to pressure banks to increase savings rates. Now questions are also being asked about the complexity of savings accounts.Context: According to the Bahrain Monetary Agency, savings accounts are very complex. The watchdog specifically targets the fidelity premium.
- Savers receive this premium only after depositing money into their savings account for twelve consecutive months. Anyone who withdraws their savings deposit early loses the entire premium, which takes a big chunk out of the total return.
- The BMA adds that banks are becoming very creative with terms and duration of the security bonus
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