The bank increased the rate by 0.02% to 2.03% yesterday afternoon.

To open the account, savers will need a minimum of £1,000 and it can only be opened and managed online.

Rachel Springall, finance expert at Moneyfacts, the data firm, said: “OakNorth are offering some of the best rates to short-term savers and it just goes to show why challenger banks are worth checking out to get a decent return.

“Challenger banks have been relentless in their fight to attract savers’ funds and consumers really do need to get online to have a chance of securing the best deals on one-year fixed bonds.”

Move fast

If this deal sounds appealing, you’d be wise to move fast because it may not be around for long.

Sponsored

Wellness and wellbeing holidays: Travel insurance is essential for your peace of mind

Out of the pandemic lockdowns, there’s a greater emphasis on wellbeing and wellness, with

Sponsored by Post Office

High demand for best buy deals means banks have been pulling top rates within a matter of days.

Wyelands Bank’s one-year bond paying 2.15% was available for just six days, while Furness Building Society’s two-year bond offering 2.24% was withdrawn just three days later.

The new OakNorth rate means it is now the top paying one-year fixed rate bond, according to Moneyfacts.

But if you’re prepared to tie your money up for three months longer, OakNorth is offering interest of 2.04% on its 15-month bond. Or Charter Savings Bank is paying 2.11% on its 18-month bond.