Bank of England Base Rate and how it affects you

This is the rate that the Bank of England charges us to borrow money. Each month the Bank of England decides whether to change it based on economic factors.

It has a direct impact on how much it costs us to lend money, so we want to make sure you can clearly see how changes to it affect your interest rates.

If you’d like to know more about the Base Rate, please visit the Bank of England website.

Your statement shows your monthly standard and cash interest rates as simple rates, with an annual compound equivalent. The annual simple rates move in line with the Base Rate – so when the Base Rate changes, your simple rate will change by exactly the same amount. 

See how simple and compound interest works.

You can find what the Bank of England Base Rate is at the Bank of England website.

We’ll leave a message for you on your monthly statement. It’ll show you how much the Base Rate has changed by and how it has impacted your standard and cash interest rates will be.

Please note that when the Bank of England Base Rate does move, it can take up to 14 days for this to be reflected in our systems. If your next statement date falls after we have updated our systems, then your interest rates will change in line with the new Bank of England Base Rate on the day after the next statement date.

If your next statement date falls before we have updated our systems, then your interest rates will change in line with the new Bank of England Base Rate on the day after the second statement date following the Bank of England Base Rate change. We will also advise you of any further Bank of England Base Rate changes via your statement.

Let’s say the Bank of England Base Rate goes up by 0.5%. You’ll then pay an extra 42p a month more in interest for every £1,000 of your balance – this doesn’t include your promotional balances as these aren’t affected by Base Rate changes.

We will decide whether it is reasonable to replace it with another rate or whether to make other changes to how we calculate interest.