Interest on savings accounts are improving following 10 consecutive Bank of England base rate rises (now at 4%) since December 2021.

But with the Bank’s latest forecast suggesting the base rate will rise to around 4.5% in mid-2023 before falling back to just over 3.25% in three years’ time, savings accounts could offer you a little bit more in the months to come.

The best you can get on an instant access account is 3.05% AER with Tandem Bank as a rate war was sparked between this ‘greener’ bank and Chase following the base rate rise.

This may be the best rate in years, but it’s still way below inflation, which stood at 10.5% in the year to December, meaning your money is losing value in real terms.

Currently, savers can get less than half the rate of inflation – 4.5% AER on a fixed rate deal, but it means tying up your cash for five years with Raisin.

But there are others ways to beat this rate and earn up to 7% interest on your cash without having to lock it up for years…

Earn 7% with First Direct

The First Direct Regular Saver rate doubled from 3.5% to 7% from November. The account is only available to First Direct 1st Account customers (new switchers can bag £175 too). New, non-First Direct customers who want the rate will need to open a 1st Account and then open a Regular Saver. Both new and existing customers must apply for the account online.

Account holders can save between £25 and £300 a month and you have to keep the money in the account for a year without withdrawals. The 7% interest will be paid in a lump sum after 12 months.

Earn 5.25% with the Club Lloyds Monthly Saver

The Club Lloyds Monthly Saver pays 5.25% AER for those depositing between £25 and £400 each month. The interest will be paid at the end of the 12 month period. You can withdraw your cash without penalty.

Do note that the Club Lloyds current account has a £3 monthly fee, though it is waived each month you pay in £1,500 or more. From 1 April 2023 you’ll need to pay in £2,000 or more.

Earn 5.12% with NatWest or Royal Bank of Scotland

NatWest and RBS (part of the NatWest group) both offer a Digital Regular Saver to their respective current account customers.

The accounts pay 5.12% AER /5% gross (variable) interest on balances up to £5,000. Balances above this earn 0.65%.

You can pay up to £150 via a standing order or ad-hoc payments into the account each calendar month.

However, you can also set up debit card round-ups to be transferred to this account and they don’t count towards your monthly £150 limit – so it’s possible to stash away a lot more than £150 a month.

NatWest and RBS are currently running ‘Double Ups’ which allow customers to double the amount that is rounded up and transferred to savings accounts. For example if you make a payment of £4.50 in a shop, if you choose Double Ups then instead of 50p being transferred, it will transfer £1 to your savings account.

To quickly build your savings balance, use your NatWest or RBS debit card for all your everyday card purchases and where possible, try to split transactions.

Barclays Rainy Day Saver Account pays 5.12%

Barclays Blue Rewards customers (£5 a month fee but rewards earned on direct debits, mortgage, insurance, Barclays loans etc) can apply for the instant access Rainy Day Saver.

It pays 5.12% AER/5% gross on balances up to £5,000 and 0.55% on balances above £5,000.

However, Barclays said customers won’t receive a monthly cash reward to Blue Rewards Wallet for having a Rainy Day Saver account. Existing monthly Blue Rewards aren’t affected and it will keep paying them into your Blue Rewards wallet.

Earn 5% on your savings with HSBC

The HSBC 12-month fixed rate Regular Saver account now pays 5% after being upped from 1% in December.

The rate applies on savings between £25 and £250 per month, with a lump sum being paid at the end of the term.

This means that for accounts of £3,000 after 12 months, the previous £16.25 in interest would become £81.25 in interest.

Earn 5% on your savings with Chase

Chase by JPMorgan attracted a million customers in its first year of launch. It offers 5% on round-ups – but there’s no option to add other money to the account too, as there is with NatWest and RBS.

With the Chase current account, you can choose to round-up your debit card spending to the nearest £1, where Chase will autosave the difference for you and apply 5% interest.

For example, say you made a debit card purchase for £10.60; Chase will round it up to £11 and put the 40p in your round-up account so you earn 5% on this 40p.

Chase will calculate your interest daily and pay it monthly. You can access and spend the money whenever you like – but if you leave it in the round-up account it will continue to earn 5% interest.

After a year, Chase will automatically transfer your round-up balance to your Chase current account, and you can start saving all over again.

Debit card round-ups are the only way to add money to the round-up account – you can’t move money to the account any other way.

Earn 5% in-credit interest with Nationwide Building Society

The Nationwide FlexDirect current account offers savers 5% AER (4.89% gross) in-credit interest.

It is available on up to £1,500 for the first 12 months. After 12 months, the account pays 0.25% AER (0.24% gross) variable.

It can be opened online or in branch and customers will need to pay in £1,000 per month which doesn’t include transfers from other Nationwide accounts or Visa credits.

Or 5% with the Nationwide Start to Save 2 account

In December, Nationwide increased the interest rate on its easy access regular saver, Start to Save 2, from 3.5% to 5% for new and existing customers.

It allows deposits of up to £50 each calendar month over a two-year period.

TSB Monthly Saver pays 5% AER

TSB has increased the rate on its Monthly Saver to 5% gross/AER, fixed for 12 months for those with its current account. You can save between £25 and £250 each month (only one payment allowed each month). There are no penalties for withdrawals but you can’t top up any withdrawn amounts.

Based on a £250 a month deposit, you would earn £71.31 a the end of the year. TSB has also launched a £200 switch bonus for new customers moving their everyday banking to one of its current accounts.

Principality’s 5% Christmas 2023 Regular Saver Bond

The building society pays 5% AER/gross on its Christmas 2023 Regular Saver Bond. It’s a one-year fixed rate, regular saver bond which can be opened online, in agency or in branch with £1.

You can pay in up to £125 each month, in one or more payments, though there’s no need to pay money in every month.

It doesn’t allow withdrawals, but you can close it early where your cash will be returned with any interest earned.

Only one account per person. Based on paying in £125 a month over the year, your balance at maturity would stand at £1,540.63.

Fixed rate bonds

If you are happy to tie your money up for longer, fixed rate bonds offer better interest rates than easy access savings accounts.

The best rate on a one-year bond is 4.17% AER from Smart Save (minimum £10,000 deposit), according to Savings Champion. Alternatively, you can earn 4.16% AER with Charter Savings Bank which has a lower minimum opening balance of £5,000.

Savers can earn 4.45% AER on the best buy two-year bond with digital challenger Atom Bank (minimum £50), while the best rate on a three-year bond is also 4.45% from Atom Bank.

The top-paying four-year deal also comes in at 4.45% from Union Bank of India (minimum £1,000), while savers tying up their cash for five years can net 4.5% AER from Raisin (provided by Işbank). It has a minimum deposit of £1,000.