BlackRock is warning that Europe's retail investors are leaving billions on the table by keeping savings in bank deposits. Rachel Lord, head of international at the world's largest asset manager, said roughly €14 trillion of household savings across Europe sits in cash accounts, benefiting banks through favorable net interest margins rather than generating returns for savers.

The opportunity cost is substantial. Research from AJ Bell shows a £1,000 ISA investment in April 1999 would be worth £6,285 in a typical North America fund today, versus just £2,079 in a cash ISA. Barclays found Britons hold over £600bn in excess cash that could be deployed in higher-yielding assets.

The UK government attempted to nudge savers by cutting the annual cash ISA allowance from £20,000 to £12,000 in last November's Budget, while the Financial Conduct Authority launched a targeted support regime making it easier for firms to offer low-cost guidance. Yet ETF penetration in Britain remains low at roughly 7%, compared with nearly a third of Germans.

Lord sees momentum building, citing the rise of digital investment platforms and younger generations embracing direct investing. The UK still has work to do to channel retail savings into capital markets.