M&S drops rate in UK loan ‘price war’
A ‘price war’ to attract UK personal loan customers was stepped up last Thursday, as M&S Bank launched the lowest rate seen in six years.
The bank dropped its rates by 0.3 percentage points to 5.5 per cent for people borrowing between £7,500 (€9,400) and £15,000 (€18,800) over 12 months to five years.
Consumer help website Moneyfacts said a rate of 5.5 per cent on a £7,500 loan over a five-year term is the lowest it has recorded in six years.
Rachel Springall, finance expert for Moneyfacts.co.uk, said: “It is not the first time M&S Bank has set the trend for rate cuts.
“In January this year it reduced its rate to six per cent, sparking a price war which is still continuing 10 months on among many lenders.
“It will not be surprising to see loans of this nature hit the five per cent mark before long.”
The new 5.5 per cent rate is the lowest M&S Bank has ever offered. This time a year ago, the lowest loan rate to borrow £7,500 over five years was a deal at 6.2 per cent offered by Nationwide.
Record low interest rates, which were held at 0.5 per cent by the Bank of England last Thursday, have helped lenders to offer some of their cheapest ever deals.