Tesco tops best saving rates as it increases interest

Savings growth

Tesco has raised the rate on its Internet Saver account for new savers to 1.55% before tax (1.24% after tax).

The rate makes it the top payer on easy-access internet accounts with no restrictions on how many times you take money out during the year. The rate includes a 0.8 (0.64) percentage point bonus payable for the first year.

Coventry Building Society's Online Saver 5 pays slightly more at 1.6% (1.28%) but you are limited to three withdrawals a year from the account.

The top deal with no withdrawal restrictions which is not boosted by a short-term bonus comes from State Bank of India at 1.5% (1.2%) and Kent Reliance at 1.45% (1.16%).

On branch-based accounts, the best deal comes from Virgin Money Access Saver at 1.51% (1.21%).

Fixed rate deals have been falling with the top one year rate at 1.95% (1.56%) from Shawbrook Bank followed by State Bank of India at 1.85% (1.48%) and Britannia, part of the Co-op Bank, at 1.84% (1.47%).

For two years you can earn 2.4% (1.92%) with Shawbrook Bank, 2.35% (1.88%) with State Bank of India and 2.27% (1.82%) with Post Office.

Find the best cash Isa or savings account for you

On tax-free cash Isas, the best easy-access deal comes from Post Office at 1.8% including a 0.9 percentage point bonus for the first 18 months. The account limits you to two withdrawals a year but you can transfer your existing cash Isas into the account.

The top rate which is not boosted by a bonus comes Virgin Money at 1.75% and the bank accepts transfers from other providers.

On fixed rate cash Isas the top one-year deal comes from Bath Building Society at 1.9%, but the account is only available for those looking to put away this year's cash Isa allowance. The best deal which accepts transfers is Britannia at 1.85%.

For two years you can earn 2.25% with the new account from Post Office, where the deposit taker is Bank of Ireland. Coventry pays 2.75% fixed for just over three years but does not accept transfers. The top rate over three years which will allow you to transfer your existing cash Isas in comes from Virgin Money at 2.4%.

This article was written for our sister website Money Observer

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Oh wow, big deal from Tesco.