Santander has reviewed its variable rates on its saving and mortgage products for existing customers following the decision by the Bank of England to increase the base rate by 0.25% to 0.75%.

In line with the 0.25 percentage point increase to all tracker mortgage products linked to the base rate, the Santander Follow-on Rate will increase 0.25 percentage points to 4.00% from 3 September.

All loans to UK businesses linked to the base rate will move in line with the change and in accordance with the terms of the deal.

Meanwhile, Santander will be making increases of up to 0.25  percentage points to a number of popular savings products, including eSaver, Junior ISA, Flexible Saver for Kids and Help to Buy ISA. All savings rates linked to the base rate will increase by 0.25 percentage points from the end of August.

The Alliance and Leicester and Santander Standard Variable Rate will increase by 0.25 percentage points to 4.99% from the beginning of September.

The 1I2I3 Current Account will continue to pay 1.50% on balances up to £20,000. 

Reza Attar-Zadeh, head of customer solutions, Santander said: “We have carefully considered our options and sought to achieve a balance between the rates we offer our savers and borrowers.

“Despite the continued low interest rate environment, we continue to offer compelling propositions for our customers and are pleased to have been able to increase rates by up to 0.25% on a range of our popular savings products.

“The 1|2|3 Current Account continues to offer a competitive 1.50% on balances up to £20,000 as well as cashback for a monthly fee.”