Barclays is making significant changes to the interest rates on two of its popular savings accounts this week.

Starting this Thursday, the high street bank will reduce the interest rates on its Rainy Day Savings and Everyday Saver accounts. The Rainy Day Savings account will see its rate drop from 5.12% to 4.87% AER for balances up to £5,000, while amounts exceeding £5,000 will continue to earn 1.16%. Meanwhile, the Everyday Saver account’s rate will decrease from 1.51% to 1.26% for balances up to £10,000. However, for balances above £10,000, the rate will increase slightly from 1.16% to 1.26%.

These changes follow last week’s decision by the Bank of England to lower its base rate from 4.75% to 4.5%. Since bank savings rates typically follow base rate adjustments, such reductions are expected.

Alastair Douglas, CEO of TotallyMoney, commented that Barclays’ Rainy Day Savings account remains competitive for those saving under £5,000. However, customers must either pay £5 monthly for a Blue Rewards account or deposit at least £75,000 annually through Premier Banking to access it.

He also pointed out that funds held in an Everyday Saver account would effectively lose value since the interest rate falls below the UK’s current inflation rate of 2.5%. Douglas advised account holders to explore better options, particularly with smaller or newer banks, which often provide higher interest rates and better service to attract customers.

Several providers currently offer easy-access savings accounts with interest rates exceeding 4%, allowing account holders to earn interest while maintaining withdrawal flexibility. Under the Financial Services Compensation Scheme, up to £85,000 per person per regulated bank or financial institution is protected. In short, staying loyal to a bank may not be the best financial decision, but switching could be beneficial.

At present, cash ISAs offer higher returns than easy-access savings accounts, with the best cash ISA rate at 5.16% from Trading 212. Among standard easy-access accounts, Coventry Building Society offers the highest rate at 4.85%. Regular savings accounts tend to have even better rates, though they often come with deposit limits. For instance, Principality Building Society provides an 8% fixed rate for six months on deposits of up to £200 per month, while First Direct offers a linked saver with a 7% fixed rate for one year, allowing monthly deposits of up to £300.