Over the past year, the tightening of the Federal Reserve's monetary policy has led to a rise in interest rates for all types of consumer credit. However, the interest rates that banks pay to their savings account holders have hardly moved.

The national average for savings rates has remained at a low 0.07% since February, when it rose by a mere couple of basis points—the first change in almost five years. Rates for mortgages and other consumer loans have increased relatively quickly, but banks aren't quite as motivated to raise interest rates for their account-holders.

The giant banks that dominate consumer banking in the U.S. are good examples of the current situation. At Bank of America, Chase, and Wells Fargo, standard savings accounts continue to earn no more than a few percentage points of interest. Even for customers with hundreds of thousands of dollars in deposits, brick-and-mortar interest rates rarely exceed 1.00%.

These major banks may eventually boost these rates as competition for deposits grows stronger, but for the foreseeable future, online-only banks and newer financial startups will continue offering higher savings rates than their bigger competitors. The delay of better savings accounts at brick-and-mortar banks can be explained by several different factors.

Deposits Have Grown Despite Low Rates

According to several recent reports, Americans have taken to storing more money in their bank accounts. FDIC data showed that total deposits grew to $11.2 billion in 2017, a 3.9% increase from the previous year. Though much of this growth can be credited to greater earnings in a strong economy, it can also be read as a sign of economic anxiety if consumers are choosing to save rather than invest or spend their wages.

Regardless of the cause, the steady growth of deposits over the past decade gives banks little reason to increase their low deposit rates. So long as consumers continue depositing money into accounts that earn some of the lowest interest rates on record, those rates will remain unchanged. However, banks still need a source of reserves to back up their lending—which is where the federal funds rate comes into play.

Banks Also Obtain Money from Each Other

Another possible reason that deposit rates haven't moved is because the federal funds rate has risen slowly. The federal funds rate is the rate that banks pay when borrowing money from one another in order to cover the loans they make. It's cheaper for banks to obtain money from customer deposits than it is for them to borrow from other banks. However, when the Federal Reserve decides to keep the federal funds rate at a low level, banks don't feel as much pressure to compete for consumer deposits.

Banks don't feel the need to raise savings account rates when it's still fairly affordable for them to meet their reserve requirements through borrowing from other financial institutions. Unless the Fed implements more rapid rate increases, there's little likelihood that consumers will see an uptick in deposit rates at major banks.

Newer Financial Companies Offer Stronger Rates

With mainstream banks finding little incentive to chase after consumer deposits, newer players in the financial technology industry have ended up taking the lead in high-yield savings account rates. These new institutions deliver deposit products online, with none of the physical branch services that cost traditional banks so much to maintain.

Online banks also tend to offer fewer banking features than standard banks, including a relative lack of checking accounts and debit cards. Such companies choose to pitch their deposit accounts as savings-oriented products instead: fewer banking options, but much better rates. Online checking accounts do exist, but few of them pay interest rates as high as the more common online savings account.

As a result of their leaner operating costs—and their greater need to attract new customers—online banks offer interest rates that go as high as 2.00%. Until economic conditions change and the largest banks are forced to compete for deposits, these newest additions to the financial ecosystem will continue to offer much stronger interest rates for typical savings accounts.

Maxime Rieman is Product Manager at ValuePenguin. Educating and assisting shoppers about financial products has been Rieman's focus, which led her to joining ValuePenguin, a consumer research and advice company based in New York. Previously, she was product marketing director at CoverWallet and launched the personal insurance team at NerdWallet.