ICICI Bank leaps to the top of savings tables
The top easy-access account comes from ICICI Bank at 1.4% before tax (1.12% after). AA Savings, Tesco Bank and BM Savings have all cut their rate from this level for new savers in the last week or so.
Coventry Building Society still pays 1.4% (1.12%) on its PostSave account but you have to run the account through the post and are limited to 12 withdrawals a year.
Kent Reliance pays a top 1.5% (1.2%) but the account is only available through its limited branch network.
On fixed-rate bonds, Virgin Money has upped its one-year rate to 1.7% (1.36%), placing it just behind the leaders State Bank of India at 1.8% (1.44%), National Counties BS at 1.76% (1.41%) and Paragon, Kent Reliance, Aldermore and Harrods Bank all at 1.75% (1.4%).
Harrods Bank pays 1.95% (1.56%) for 18 months, while the best two-year deal is 2.25% (1.8%) from State Bank of India and Harrods Bank.
On tax-free fixed-rate cash Isas, the top one-year deal is now Virgin Money's 1.7%. For two years Post Office pays 1.95%, while both Kent Reliance and Aldermore Bank pay 1.85%.
On easy-access cash Isas you can earn a tax-free 1.5% on Post Office Premier Cash Isa. The rate includes a 0.85 percentage point bonus for the first 18 months you are in the account.
Top deals with no bonus include Barclays Bank Instant Cash Isa issue 1 at 1.49% on a minimum £30,000 or Sainsbury's Bank at 1.45%. All three accept transfers from other providers.
National Savings & Investments pays 1.5% on its Direct Isa, but you cannot move the cash Isas you hold with other providers into this account.
This article was written for our sister website Money Observer
Invidivual Savings Accounts were introduced on 6 April 1999 to replace personal equity plans (PEPs) and tax-exempt special savings accounts (TESSAs) with one plan that covered both stockmarket and savings products, the returns from which are tax-exempt. The ISA is not in itself an investment product. Rather, it’s a tax-free “wrapper” in which you place investments and savings up to a specified annual allowance where the returns (capital growth, dividends, interest) are tax-exempt (you don’t have to declare ISAs and their contents on your tax return). However, any dividends are taxed within the investment, and that can’t be reclaimed.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.