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Bank Services: Interest Rates

Question for HM Treasury

UIN 47182, tabled on 7 October 2016

To ask Mr Chancellor of the Exchequer, whether he is taking steps to encourage banks to reduce interest rates inline with base rate reductions.

Answered on

14 October 2016

Alongside the Monetary Policy Committee’s decision to cut Bank Rate to 0.25%, the Chancellor on 4 August authorised the introduction of a new Term Funding Scheme.

The Term Funding Scheme will lend central bank reserves to banks and building societies for an extended period at rates close to Bank Rate, in order to ensure the low level of Bank Rate is passed onto borrowing rates faced by households and businesses.

Answered by

Treasury