After previous top providers reduced their rates, a swathe of fresh lenders are leading the pack for savers’ investments.
At a time when millions of Brits have a combined £400bn sat in poor-paying accounts, YourMoney.com has looked at what accounts could add thousands to your pot.
Last week, ICICI Bank UK were top of the tree for fixed-term bonds, but they have been unable to keep up with the competition.
With data from Moneyfacts, here are this week’s best savings rates.
Easy access accounts
Metro Bank’s Instant Access Savings Account offers 5.22%, paid monthly, making it the market-leading option for savers wanting to dip into their funds. It also boasts a 3.46% bonus for the first 12 months, which needs £500 to be deposited within 28 days of opening the account – if not, a lower underlying rate is applied. If you wish to make a withdrawal, no penalties are added but one day’s notice is required for withdrawals over £1,000.
In second place is Ulster Bank’s Loyalty Saver account, which pays 5.20% yearly if you have £5,000 in the pot. A lesser rate of 2.25% AER is applied if the balance is below that amount. Much like Metro Bank, withdrawals come free of any penalties.
Completing the top three, Earl Shilton Building Society has a 5.15% AER account that pays the rate yearly. The Bonus One Account needs £5,000 in the bank and only one penalty-free withdrawal is accepted each year, any more after that sees 2.10% AER paid instead.
Fixed bond rates
Sharia Law provider, Al Rayan Bank is the best option for one-year fixed bonds, with an unchanged rate of 5.50% AER. The account requires a minimum deposit of £5,000, while early access and withdrawals are prohibited. An expected profit will be paid every quarter and the account can be managed online, by post or with your mobile.
For two-year fixes, look no further than the Union Bank of India (UK) Ltd which has a Fixed Rate Deposit and Union Premier Bond account, both priced at 5.15% AER. A minimum of £1,000 is needed for the former and £5,000 has to be deposited for the latter.
The Fixed Rate Deposit pays interest on anniversary or on maturity, while the Union Premier Bond only pays on maturity. If you want flexibility, consider that no further additions are accepted and the same applies to withdrawing funds early.
Post Office Money is still the leading three-year fix account, priced at 5.00% AER on its Growth Bond (Issue 57) deal. A minimum of £500 is needed to get going, while interest is paid on anniversary and no further additions or early access is permitted.
For a longer time keeping a rate, The Bank of Ceylon (UK) has a market-leading 5 Year Fixed Term Deposit Account from The Raisin UK, priced at 4.55% AER. Savers can enjoy interest paid on maturity which compounds annually.
This account is one for those comfortable with online banking, as it can only be managed in that way and via the app. Further, a minimum of £5,000 needs to be in the pot to commence saving and early access and further additions are not allowed.
Notice accounts
FirstSave once again is the market leader, with a 30 Day Notice Account (5.00% AER) and 90-day equivalent (5.40%) that needs at least £100 to open. Interest is paid on anniversary for both but if you can add £5,000 on opening, you can decide whether to receive the interest monthly. Unlike fixed-term accounts, further additions are permitted, while any withdrawals will lead to a loss of interest relevant to the account you pick.
QIB UK remains top in the mid-range notice market, paying an expected profit rate of 5.35% AER on its Raisin UK – 60 Day Notice Account. You need a £1,000 investment and the account can be managed online, on the app or through the third-party savings platform. Savers wanting to withdraw their funds will need to give 60 days’ notice, but doing so will lead to the account being closed.
