The lender’s Standard Variable Rate (SVR) and the Alliance and Leicester SVR will match that rise by 0.25% from September 3 to 4.99%.
Santander is also increasing its second ‘follow-on’ Standard Variable Rate which was launched in January, by the same amount taking that rate to 4%.
The Bank of England increased the base rate from 0.5% to 0.75% in August, taking it to its highest level since 2009.
The new rates will be communicated to customers along with details of new monthly repayments, Santander said.
Following the market
The bank is the latest lender to increase variable rates. Halifax, Lloyds and TSB have also increased SVRs by 0.25%.
Sainsbury’s has also announced a number of increases across its fixed-rate ranges.
Lenders have come under fire for hiking mortgage rates by 0.25%, while failing to push through similar increases across variable savings products.
Santander said it was increasing its eSaver, Junior ISA, Flexible Saver for Kids and Help to Buy ISA by 0.25%, as well as rates linked to the base rate.
Reza Attar-Zadeh, head of customer solutions at 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.”
