The City regulator has announced proposals to make it easier to compare and switch cash savings accounts, saying the market is not working well for consumers.
The Financial Conduct Authority (FCA) study found £160bn of funds in the £700bn market were earning the same or less than the 0.5% Bank of England interest rate.
It also suggested that older accounts tended to earn less in interest than those opened more recently, with 80% of easy-access accounts not being switched in the last three years.
Potential remedies, which are going to consultation, include reducing the current 15-day switching time for cash ISAs and improved communication with customers to provide better clarity on interest rates.
The watchdog stopped short of banning introductory rates but said consumers needed to be better informed on rate movements to aid shopping around.
The FCA said it was clear the market "does not work well" for consumers, particularly those with long-standing accounts.
Director of competition Christopher Woolard said: "In a good market firms should be competing to offer the best possible deal and consumers should have the information they need to help them shop around.
"We want to see firms making simple information much easier to find. More also needs to be done to reduce the hassle for consumers to switch their savings.
"The steps we have proposed today are designed to make the market more dynamic, working in everyone's interest."
The Bank of England's base rate of interest has been at its record low of 0.5% since March 2009.
The impact has hit savers hard and driven many towards the stock market in search of returns.
Previous research by the consumer group Which? found people were losing out on £4.3bn annually by leaving savings in poor-value accounts.
Richard Lloyd, its executive director, said of the FCA's proposed action: "For too long, banks and building societies have left customers trapped in savings accounts paying woefully low interest rates and losing out on billions.
"We now expect to see the industry working with the regulator to make these recommendations a reality as soon as possible.
"The banks must quickly start playing fair and help consumers get a good deal."
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