Savings update: Providers continue to increase rates

Published by Sylvia Morris on 20 March 2018.
Last updated on 20 March 2018

Savings update: Providers continue to increase rates

Savers looking for a straightforward easy access Cash Isa with no withdrawal restrictions can earn 1.25% with Shawbrook Bank’s Easy Access Cash Isa (Issue 2).

But the top payer is Nationwide, offering 1.4% on its Loyalty Single Access Isa. This rate is not widely available, though, as it is only open to those who have been a member of the building society for at least 12 months. In addition, savers limited to making just one withdrawal a year. Those who do not qualify for this deal can earn 1.3% through the building society’s Single Access Isa, which is open to all.  

Elsehwhere, OakNorth Bank has raised the rate on its one-year fixed rate Cash Isa to 1.52%, putting it ahead of Virgin Money, which upped its rate last week to 1.5%.  For two years the best rate is 1.67%, available from both Paragon and Charter Savings Bank

On taxable easy-access accounts ICICI Bank Hi-Save Bonus Saver currently pays a top 1.35%.  But the rate includes a 0.7 percentage point bonus payable until the end of January next year.

Top accounts with no bonus include French-owned RCI Bank Freedom account at 1.3% with no withdrawal restrictions, but remember your savings here are covered by the French deposit protection scheme, not the UK’s FSCS.

Virgin Money Double Take E-Saver 4 also pays 1.3%, but limits you to making just two withdrawals a calendar year.

Elsewhere, Shawbrook Bank’s Easy Access (Issue 11) pays 1.25% while the Ford Money Flexible Saver is available at 1.22%.

On taxable fixed rate bonds, the best one-year rate comes from Investec at 1.85%, although you must deposit £25,000 or more to get this rate. Also offering 1.85% is Ikano Bank, it requires a lower £1,000 minimum deposit but your savings here are covered by the Swedish deposit protection scheme, not the UK’s FSCS.

The best fixed rates over a two year term come from Swedish-owned Ikano Bank at 2.1% and OakNorth Bank and Paragon at 2.09%.

Savers have until April 5 to make use of their £20,000 Cash Isa allowance for this tax year and pay no tax on the interest they earn.

Savings accounts to beat inflation

To beat inflation compromises need to be made as all of the small number of regular savings accounts that pay more than inflation require savers to have a current account with the provider.

Moneywise keeps tabs on the savings market has found there are accounts that currently beat inflation.

This article was written for our sister magazine Money Observer.

Read more on savings and Cash Isas on Moneywise

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