Long-suffering savers see another drop in rates

2 December 2014

BM Savings has closed its Internet Extra Isa at 1.55%, replacing it with another version for new savers at 1.35%.

Hinckley & Rugby Building Society has cut by 0.15 percentage points the rates on 19 accounts for existing savers, including its Premier Saver which now pays 1.1% before tax (0.88% after tax). Metro Bank will cut rates for new savers from today.

The top easy-access cash Isa rate comes from Post Office Premier Cash Isa at a tax-free 1.55%, including a 0.8 percentage point bonus for the first 18 months. You can transfer your existing cash Isas into the account.

The best deal without a bonus comes from National Savings & Investments Direct Isa at 1.5% but this account does not accept transfers. Barclays pays 1.49% on a minimum £30,000 on its Instant Cash Isa issue 1, while at Sainsbury's Bank the rate is 1.45%. Both accept transfers.

Find the best Cash Isa or savings account for you

Fixed-rate Cash Isas

On fixed-rate cash Isas the best one year deal is 1.7% from Post Office or 1.65% from Virgin Money. Barclays and AA Savings, part of Halifax, both pay 2% for two years.

On taxable accounts the over 50s can earn 1.55% (1.24%) with Saga Internet Saver.

For others the best deal is 1.4% (1.12%) from AA Savings, Tesco Bank and Post Office. All four accounts include a bonus for the first year, after which the rate will drop as low as 0.4% (0.5%).

If you prefer an account without a bonus then State Bank of India and Kent Reliance pay 1.25% (1%).

On fixed-rate bonds First Save pays 1.85% (1.48%) for one year, while the top two-year rate is 2.25% (1.8%) from State Bank of India.

This article was written for our sister website Money Observer

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