A savings account advertised at an attractive rate frequently pays much less a year later. The expiry is not an oversight; it is how the product was designed.
New money and existing money are priced separately
A bank trying to grow deposits needs to appeal to people currently holding money elsewhere. Those people compare headline rates and will move for a large enough difference.
Existing customers have already chosen the bank and mostly stay. Paying them the promotional rate costs the institution money without attracting a single additional deposit.
The introductory bonus resolves the conflict by applying a high rate to newly arrived funds for a defined period and then reverting to the standard rate.
Acquisition cost is amortised over the relationship
Winning a new depositor has a cost, whether through advertising, comparison site fees or the elevated rate itself. Banks accept that cost expecting the balance to remain.
Once the promotional period ends, the account earns the standard margin, which is what repays the acquisition expense over the following years.
A customer who moves immediately when the bonus lapses is unprofitable, which is precisely why the reversion is quiet rather than clearly signposted.
Reversion is usually silent by design
Notification requirements vary, and in many cases a rate reduction that was disclosed at opening requires no fresh warning when it takes effect.
The change appears only in a lower monthly interest credit, which is easy to miss on an account that is not examined regularly.
The gap between the reverted rate and the current best offer is often larger than the original bonus was, since standard rates lag the market persistently.
Conditions narrow who actually receives the headline
Promotional rates commonly apply only up to a balance cap, with amounts above it earning the standard rate. Large balances therefore earn a blended figure well below the advertised one.
Other conditions include a minimum monthly deposit, a linked current account, or a limit on withdrawals, any of which can void the bonus for a given month.
Reading which balance the rate applies to, and under what conditions, matters more than the headline figure for anyone with a substantial sum.
What the pattern implies for a saver
Treating a savings account as a permanent decision guarantees drifting onto a below-market rate, because the product is structured to assume exactly that behaviour.
Setting a reminder for the expiry date converts the bonus into a genuine gain rather than a temporary one that is later given back.
Fixed-term accounts avoid the issue by stating a rate for a defined period, at the cost of locking the money up for that period.