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Coventry revives 1.5% easy access ISA rate, as providers battle for best deals

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A mini rate war has broken out in the easy access ISA market with three main contenders battling for pole position.

Coventry Building Society is the latest provider to show its hand, raising the rate on its easy access ISA to a market-leading 1.50% AER.

The move knocks Skipton Building Society back into second place after it raised its rate to 1.48% just six days ago.

Skipton’s rate increase was made in response to Coventry BS and Virgin Money bumping their rates to 1.47% the previous week.

Coventry BS was offering 1.50% back in March.

“It’s great to see this mini battle going on between Coventry, Skipton and Virgin, keeping the cash ISA season alive, certainly between easy access ISAs,” said Anna Bowes, co-founder of rate monitoring site Savings Champion.

Coventry’s latest rate increase means that easy access cash ISA savers can earn the same as they can on non-cash ISAs, which is good news for savers who use their personal savings allowance each year.

Our take

It’s always good to see competition between banks and building societies driving rates up.

However, with consumer price inflation at 1.9%, savings sitting in these top-paying easy access accounts are still losing value in real terms.

It’s prudent to keep your emergency savings in an easy access account so you can get your hands on your cash immediately. But any extra money should go into fixed-term savings products, where you can earn an inflation-beating rate by locking your money away for just 12 months.

(See a list of the best ISA and non-ISA accounts here).

One more thing: if you decide to open an easy access ISA with Coventry, it’s worth noting the headline rate includes a bonus of 0.35% bonus until 31 August 2020 so you should review the deal shortly before the bonus expires to make sure it is still competitive.

Skipton’s headline rate also includes a bonus of 0.48% for 16 months.

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