Small and medium sized businesses (SMEs) across Swindon are losing out on an average of £2,256 per year in ‘lost’ interest payments, according to new research.

The big six high street banks, Barclays, HSBC, Lloyds, Nationwide, NatWest and Santander, have been accused of "ripping off" these businesses by Allica Bank, which carried out the research, by offering them "excessively" low rates of interest on their savings.

Allica Bank's independent tracker has revealed average rates offered by these banks to small businesses are just 1.39 per cent, compared to up to 4.4 per cent offered by challenger banks on the same savings.

This discrepancy means an average SME with £75,000 of savings in one of the big banks is missing out on £2,256 a year in extra interest.

For businesses with £1 million in the bank, this translates to £30,080 annually.

With 7,050 small and medium sized businesses across Swindon, this means the town's economy is losing out on a total of more than £15.9 million every year.

Allica's research also estimated the value of lost interest to the UK as a whole to be £8.6 billion a year, up 15 per cent from £7.5 billion in September 2023.

In response, Allica Bank is calling for a change to the business savings market, and for government and regulators to force big banks to notify their SME customers of the top rates in the market and where they can be found.

This, it said, will increase transparency, encourage competition and help businesses make more informed decisions about managing their savings.

Gareth Adams, relationship manager for Swindon at Allica Bank, said: “Swindon’s SME economy is Swindon’s real economy, accounting for more than 7,000 businesses.

"These businesses are the life and soul of communities across the town and the difference between boarded up shops and vibrant high-streets.

“Despite this, SMEs aren’t getting the returns they deserve from high-street banks with interest rates that are consistently lower than are offered to bigger businesses.

"This lost income could represent a significant boost to Swindon’s economy and be put toward investment in the business and support for growth plans.

“The high-street banks are taking SME customers for granted, and those customers should shop around and get the return on their savings that they deserve.”

Allica’s research tracks the top rates offered every month by the challenger banks and contrasts it against those rates offered by the six largest incumbent providers in the UK.