Savings update: no improvement on horizon as rates continue to fall


Rates on fixed–rate bonds continue to fall, with French-owned RCI Bank cutting its one-year rate to 1.75% before tax (1.4% after) for new savers, down from 2.01% (1.72%).

The top one-year rate is 2% (1.6%) from Swedish-owned Ikano Bank or 1.76% (1.41%) from Charter Savings Bank.

For two years you can earn 2.15% (1.72%) with RCI Bank or Ikano Bank or 2% (1.6%) with United Trust and Paragon banks.

The best easy-access deal is the online RCI Bank Freedom account at 1.55% (1.24%). Virgin Money Defined Access pays 1.31% (1.05%) but you are limited to making three withdrawals a year. Shawbrook Bank Easy Access 3 offers 1.3% (1.04%) with no withdrawal restrictions.

Compare savings accounts and cash Isas with our tool.

No improvements

There is no sign that cash Isa rates are going to improve in the run up to the end of the tax year on 6 April.

Among the top easy-access rates is Coventry Building Society at 1.4% tax-free.

Post Office pays a marginally higher 1.45% but this includes a bonus for the first year after which the rate drops to 0.65%. Virgin Money pays 1.41% but restricts you to three withdrawals a year.

On fixed rate cash Isas the best you can do is 1.5% for one year with Virgin Money, Aldermore and Shawbrook banks. Kent Reliance, Aldermore and Metro banks all pay a top 1.75% for two years.


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