Clydesdale Bank and Yorkshire Bank have unveiled their first online savings account, but should you open one?
The banks’ new fixed saving account, which is the first time the banks have allowed savers to open an account online, pays an interest rate of 1.5% AER, fixed until 28 September 2018.
Interest is paid quarterly and account holders can save anything from £2,000 to £5 million.
While the account must be opened and managed online, cheques can be deposited into the account in branch.
After maturity, the balance will be moved to a 95 Day Digital Notice Account and customers will be notified of the rate on this account 35 days in advance. Savers will have a two-week window to withdraw their cash with instant access prior to a rollover into this 95 Day Digital Notice Account.
Fergus Murphy, group customer value director at Clydesdale and Yorkshire Banks, says: “We’ve launched the online fixed rate bond following customer demand for a streamlined digital deposit offering, a product which allows them to make more from their savings in the relative short term.”
How does this account compare?
If you’re looking to lock your savings away for a year, then this 1.5% rate from Clydesdale and Yorkshire can be beaten.
The top one-year fixed saver currently comes from Atom Bank which pays 1.8%, although you will need a smartphone to open and manage your account.
Elsewhere, OakNorth Bank offers 1.71% on its online-only one year Fixed Term Deposit while Kent Reliance pays 1.7% on a one year fixed account that can be opened by post, online or in its branches in the South East of England.
Savings in all these accounts are protected up to £85,000 by the FSCS.
See the full table below for the best one year fixed accounts.
|Provider||Account name||Open||Min/max balance||Interest rate (AER)|
|Atom Bank||One Year Fixed Saver||App||£50-£100,000||1.80%|
|OakNorth Bank||Fixed Term Deposit||Online||£1,000-£250,000||1.71%|
|Kent Reliance||One Year Fixed Rate Bond (Issue 47)||Branch, post and online||£1,000-£1m||1.70%|
Source: Moneywise, rates correct as of 27 June 2017