Martin Lewis has called on the banks to come to the taxpayer’s aid in the same way taxpayers came to their aid in 2007.
The money saving expert has approached the chancellor about a mortgage ticking time bomb that is about to explode after interest rates were hiked by the Bank of England to 5 per cent.
Lewis said that if interest rates are going to be high over three or four years, people are going to have to readjust their finances and there could be countless defaults as monthly repayments go up.
But he said there are more banks can do to help struggling customers, such as resisting the temptation to profiteer from rising interest rates.
Speaking on his podcast, Lewis said: “I would certainly be pushing for a decrease in margins and I would want some of the money, the increased profits that banks are making. And let’s just remember for a second, I used to be of a very clear mode – we shouldn’t rely on banks to rescue us; it should be regulators and politicians.
“But in the 2007 financial crisis, we – taxpayers, the state – rescued banks. They were too big to fail. When times were difficult for the banks, we came to their aid.
“Times are difficult for the public right now. They [the banks] are making increased profits. That is wrong. They need to come to the public’s aid. Banks need to not be increasing their margins and effectively profiteering from interest rates. What they need to do is come to the public’s aid.
“And I think the way that that is probably most likely to work is by upping rates for savers and by putting money aside to aid on forbearance.”
Related: Politicians and members of the media rub shoulders at Murdoch annual party
