THE Bank of England’s recent base-rate cut may have proved good news for some mortgage customers, with a number of lenders moving to reduce the rates on certain products, but for savers the picture is far less rosy.

Having endured years of dismal returns since the 2007 financial crash, depositors are now being faced with banks and building societies slashing their rates even further.

And, with Bank of England governor Mark Carney pencilling in a further cut to 0.1 per cent in November, there could be more pain to come.

According to financial information website Moneyfacts there have been 388 individual cuts to savings rates since the central bank reduced the base rate to 0.25 per cent at the beginning of August, with just three savings rate rises during that time.

Rate reductions in the savings market have now outweighed rate rises for 11 consecutive months, with the average easy access account now paying just 0.47 per cent and the average cash ISA paying 0.97 per cent.

This represents a one-month fall from 0.54 per cent for easy access customers and from 1.13 per cent for ISA customers. Over a five-year period during which the base rate remained static at 0.5 per cent the drops are even more stark, with average interest rates on easy access accounts sitting at 0.95 per cent in September 2011, when average rates on cash ISAs were 2.51 per cent.

Charlotte Nelson, a finance expert at Moneyfacts, said the cuts “may be the final nail in the coffin for savers”, who she said should “keep a close eye on the market and act fast to get the best deals”.

For Matt Sanders, head of money at price comparison website Gocompare, the fact that so many providers have chosen to cut their rates further in the past month shows they are prepared to pass on more pain to customers than they are having to take themselves.

“Over 300 products had a rate cut in August and they’ve been quite disproportionate to what the Bank of England has done,” he said. “There are economic factors in there as well but this is not fair on consumers.”

Mr Sanders agreed with Ms Nelson that the onus now is on savers to shop around for the best deal, although he pointed out that for the moment at least these may not be found in the traditional savings market.

According to price comparison website Moneysupermarket the best deals in the cash ISA space are currently being offered by Ipswich Building Society, Scottish Building Society and Vernon Building Society, with Ipswich offering a 2 per cent fixed rate or a 1.8 per cent variable rate and the other two each offering 1.8 per cent variable rates. The catch is that savers must already be customers of these providers and, in the case of Ipswich and Vernon, live close to where the institutions have branches.

While fixed-term bonds have traditionally offered an alternative for savers willing to lock their cash away in return for higher interest rates, these too have been hit by substantial rate cuts in the past five years as well as in the last month.

Moneyfacts’ data show that the average rate on a two-year fixed bond fell from 3.34 per cent in September 2011 to 1.34 per cent in August this year and 1.16 per cent today while on five-year bonds the average rate fell from 2.68 per cent five years ago to 1.98 per cent last month and 1.63 per cent today.

Mr Sanders said that in light of this customers may in fact be better off using current accounts as a savings vehicle instead, with the likes of Nationwide and TSB still offering rates of 5 per cent on balances up to £2,500 and £2,000 respectively. Until 1 November Santander’s 123 account will pay interest of 3 per cent on balances between £3,000 and £20,000, with the rate dropping to 1.5 per cent thereafter.

For those who are willing to take on a little bit more risk, there are also websites such as Nutmeg and Wealthify, which allow consumers to invest in a range of low-cost investment funds that have the potential to offer higher returns, although how much and over what time period is dependent on the markets.

Mr Sanders pointed out that while savers going down that route would have their investment protected by the Financial Services Compensation Scheme they would not be guaranteed a return, meaning “it’s a bigger decision than taking out a regular savings account”.

Andrew Hagger, founder of the Moneycomms website, added that peer-to-peer lending could also be an option, with the Ratesetter website offering accounts that pay in the region of three per cent and use savers’ funds to lend to those seeking loans. Crucially, however, such products do not have FSCS protection, meaning the deposit as well as the interest could be lost.

Such high-risk options are unlikely to prove popular among individuals who just want to put their cash in a bank account and watch it grow.

However, Mr Hagger urged people not give up the savings habit altogether.

“At least if you’re putting capital aside then when interest rates pick up again you’ll be in a better position to take advantage of that,” he said.