Ethical way to keep an eye on your cash

Savers have taken a battering over the past couple of years. While falling interest rates are a boon for homebuyers taking out a mortgage or people in search of a cheap loan, anyone with a pot of savings faces only pain.

Standard deposit accounts with long notice periods barely protect small savings and there are some current accounts that offer higher interest rates than many no-notice accounts offered by the major finance companies.

The winner in the category for best savings provider in this year's Consumer Finance Awards is Triodos Bank. Like most banks it is unable to offer much to the customer in search of high growth. The small Bristol-based bank pays 0.5% annual interest to savers with less than £1,000 who want a no-notice account.

Rates improve dramatically for savers with more cash to put away, but they still need to deposit more than £5,000 to beat inflation of 2.5% - the point at which the bank's 'eco account' pays 2.55% gross.

These rates rank alongside most no-notice offerings from the major high street banks.

Yet Triodos Bank cannot be accused of offering plain vanilla products with nothing to recommend them other than an average rate of interest.

It has brought together a collection of savings plans that support different types of socially responsible, environmental and ethical projects - and this collection is unmatched by any other bank.

Managing director Simon Roberts says people who wish to support these kinds of projects want to put their money away for some time. They know environmental projects, such as switching a farm to organic methods, take time and the bank needs to lend out their money for long periods before it begins to make a difference.

"We have a social investor account that starts at £500 which is a rainy-day kind of account. It pays 3.9% gross on deposits over £5,000 and people expect to leave their money there for some time."

There is also a young saver account that acts in the same way. But the savings plans tied to specific projects are what set the bank apart.

"People often feel very detached from the money they give their bank to look after," says Mr Roberts.

"With us they have the opportunity to keep in touch with how their investment has affected the projects they support. We have relationships with organisations that allow us to build even closer ties between the customer and what happens to their money.

"There is an organic saver account in partnership with the Soil Association and an earth saver account in partnership with Friends of the Earth, which is more about supporting renewable energy projects."

Neither of these accounts will figure in a best-buy top 10 chart. But, says Mr Roberts, that's not the point.

"We are never going to be top or bottom on the tables of rates, but it should be possible to run a bank that operates along ethical lines but doesn't skimp on customer service," he says.

Customers can buy Triodos products over the phone or visit the bank's single branch in Bristol.

Runners-up in the savings provider category are Smile, Scottish Widows, Virgin Direct and First Direct.