We don't like Standard variable rate

Nottingham building society has increased its standard variable rate (SVR) by 0.35% to 5.89% in response to the 0.25% rate rise last week.

The Nottingham claims this is to "re-position ourselves with major societies and that we are still lower than many high street competitors."

But to add to the problem, the Nottingham still calculates interest annually while most competitors use a daily basis.

Annual interest on a repayment mortgage increases the real rate by at least 0.1% which almost eliminates any claimed advantage.

Harpenden building society has done the exact opposite. It will maintain its SVR at 4.99% despite the rate rise while passing on the full increase to savers.