The bank found that nearly 2.4 million fixed-term savings accounts are set to mature in the next three months, with the majority of accounts (1.57 million) ISAs.
Paragon Bank’s analysis of CACI data shows 826,000 non-ISA fixed-rate variants are due to mature in the next three months. CACI compiles the savings deposits of 40 providers of cash savings.
Paragon Bank found that more than half a million (535,000) non-ISA fixed-term savings accounts due to mature over the next three months will have generated enough interest to incur a tax payment if the account holder is a higher-rate taxpayer.
Analysts at the bank predict that April is set to be the busiest month for accounts maturing, with one million fixed terms coming to an end, while 719,000 accounts will mature in March.
Derek Sprawling, Paragon Bank’s managing director of savings, said: “Over half a million non-ISA fixed-term accounts are maturing with sufficient interest to incur a tax bill for the holder, and I would expect those savers to consider switching to an ISA variant if they don’t already utilise their annual tax-free allowance.
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“The upcoming months will be a pivotal time for millions of savers as their fixed-rate accounts mature. With a significant portion of these accounts earning rates [that] were set when underlying reference rates were at their peak and showing signs of upward movement, most maturing savers will, unfortunately, likely not be able to match their previous rate when it comes to an end. It’s therefore essential for savers to consider their options carefully to match their current, and future, returns.”
