Millions of people in the UK are potentially missing out on nearly £1,000 extra income a year because their savings are in low or no-interest paying current accounts, Yorkshire Building Society has suggested.

Analysis by the building society and CACI has indicated there are nearly 13 million current accounts held in the UK with balances above £5,001, and of those people who hold at least £5,001 in their account, the average balance held is £24,500.

Almost £400bn is being held in current and savings accounts earning 1% interest or less, but a lack of understanding of the impact of their savings habits means millions are losing out on potentially thousands of pounds in interest.

Research also completed by Yorkshire Building Society, based on a study among 2,000 UK adults, has suggested that over half (55%) of savers haven’t compared the interest paid on their accounts in the last year, and over a third (36%) hold most of their savings in a current account, which offers little or no interest.

Around half (49%) of people surveyed said they had dipped into their savings in the last 12 months, and being able to access money in an emergency is one of the reasons people don’t switch to higher-paying savings accounts. The average amount that people felt they needed to be able to access right away was £4,000.

“Despite savings interest rates getting a lot of attention over the last year, following the significant increases in the bank rate, it’s surprising that there are still large pockets of people who are significantly missing out on savings interest – shopping around can now make a substantial difference to the returns available,” said director of savings at Yorkshire Building Society, Chris Irwin.

“Keeping large amounts of funds in low paying current accounts has become a costly mistake for millions. It’s understandable to want to have money accessible for emergencies or even topping up everyday expenses, but with so many instant access savings accounts currently available in the market paying a much higher return, there has never been a better time to review the home of your savings.”

Meanwhile, half (50%) of people surveyed also said interest rates are the key driver for choosing a new savings provider, yet 22% of people said they didn’t think it’s worth moving their money.

One in five (19%) said they couldn’t be bothered with the hassle of moving their money and 13% said they have never shopped around for a savings provider. The research also indicated that over half (53%) of people believe they are happy with their current provider.

Irwin added: “Reviewing finances and savings can sometimes be an afterthought, with other things in life taking priority, however the start of a new year provides the perfect opportunity to take a close look at your finances and increase awareness of your situation and from there look at how you could make small changes which add up to much bigger returns.”

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