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Yorkshire BS launches 7% savings account – but there’s a catch

Rebecca Goodman
Written By:
Rebecca Goodman

A regular cash savings account has been launched by Yorkshire Building Society paying 7% on a maximum of £500 per month. How does it stack up against competitors?

The Loyalty Regular Saver pays a variable interest rate of 7% Gross p.a./AER variable on balances up to £6,000, allowing savers to put away up to £500 a month for a year.

It can be opened in branch, agencies and online with £1 and also allows one penalty-free day for withdrawals during the year term. But customers can close the account at any point if they need to.

Savers paying in £500 at the start of the month for 12 months would end up with a balance of £6,227.40 if the interest rate remains at 7%.

But the new issue from Yorkshire Building Society (YBS) isn’t for everyone, just existing customers who save or have a mortgage with the mutual, and have had a continuous membership for at least 12 months prior to applying for the Loyalty Regular Saver.

It’s available to existing customers from the following brands: YBS, Chelsea, N&P, and YBS Shareplans. The online version of the account can only be opened if a customer already has online access.

‘We recognise the loyalty of our valued savers’

Chris Irwin, director of savings at Yorkshire Building Society, said: “Our founding purpose as a building society is to help people build financial resilience and get the best value on their savings so we’re committed to exploring ways that can help our members reach their financial goals or save for the future.

“We’re really proud that this new account, which comes with a highly competitive interest rate and a generous monthly deposit limit is another example of how we recognise the loyalty of our valued savers. Previous issues of this account have proved popular with savers and we’re sure this latest edition will be equally as well received.”

There is also a Regular Saver account available to all customers which pays a variable interest rate of 5.25%. Savers can deposit between £1 and £250 per month and can make a withdrawal twice a year and close the account at any point if needed.

The building society says previous issues of its regular saver have been popular and if this new account follows suit, it expects to pay out over £14m in interest to customers.

How does the new account compare with others on the market?

In terms of rate, it matches the current longstanding and market-leading account from First Direct (7%), but YBS has a higher monthly deposit amount compared to First Direct’s £300 a month limit.

However, the YBS offering is geared towards rewarding existing loyal customers, while with First Direct, you need to have a current account to get the regular saver rate. There’s no requirement to have held a product with First Direct for a period of time to get the deal so if it’s right for you, you can open its current current and then open the regular saver. Just watch out as First Direct doesn’t allow any cash withdrawals from the regular saver.

Elsewhere, there’s also a 7.5% regular saver from Skipton Building Society but it’s only available to existing customers who held a savings or mortgage account with it on or before 31 May 2023.

These accounts pay far higher than the best fixed-rate products on the market, but they have smaller overall limits for the amount of money you can put away.

Related: How to get 7.5% interest without tying up your cash for years