"Last month, Nat West warned business customers that if negative interest rates occurred in the UK, then it would have to charge them on their accounts. This month, in order to avert a slowdown post the Brexit Referendum, the Bank of England have reduced interest rates from 0.5%, where they had been since March 2009, to 0.25%. In addition, Quantitative Easing (QE) has been restored to the tune of £60bn, including for the first time the purchasing of corporate bonds, as well as government bonds. Both bond and equity markets rose on the announcement and it looks like it is going to be “even lower for much longer”. The search for yield continues apace."
A major high street bank has paved the way for the introduction of negative interest rates for the first time in Britain by warning customers it may have to charge them to accept deposits. The warning by NatWest was made in a letter changing the terms and conditions for the bank’s 850,000 business customers, which range from self-employed traders, charities and clubs to big corporations. It could mean that an account holder with £1,000 in a NatWest account could see that shrink to £999 or less the following year as the bank charges a negative rate of interest.