It appears that not only are consumers feeling the pinch, so are the banks.

In the UK today a large number of our banks actually borrow money themselves. The banks then take the money in and the lend it out charging a margin over and above and that’s their profit margin.

The problem is, that if these banks do take this money in at the current high rates and charge their normal margin, their product offering is just too expensive.

In simple terms they cant afford to compete with those banks that dont need to borrow, Building Societies seem to be top dogs in this environment as most have an oversupply of savings.

Virgin Building Society anybody ?

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