A leading consumer group is calling on banks to cut their standard variable mortgage rates in line with reductions in the base rate.
Which? have pointed out that a large majority of mortgage lenders have failed to pass on the recent 0.5 per cent cut to their customers. According to the BBC, the group believes banks should give customers "a break".
Which? personal finance campaigner Phil Jones told the news provider: "It's becoming clear that we're facing a worsening time in the housing market. As banks are receiving support from the public at large, there has to be a quid pro quo."
The call coincides with the group's campaign for reform in the banking industry. It is urging the government to make some "consumer-focused" changes in the sector to ensure that banking customers are treated fairly.
In a letter to chancellor of the exchequer Alistair Darling, Which? said it may be necessary for the government to force banks that have received financial assistance to pass on base rate cuts as soon as they occur.
The Ernst & Young Item Club predicted recently that interest rates could fall as low as three per cent next year as the Bank of England seeks to stave off the worst effects of the economic downturn.
