🔔 Easy Access Rates are on the rise – you could earn up to 1.11% AER!

The amount of cash pouring into easy access accounts has continued to rise and according to the latest figures from the Bank of England, there is now £967.5 billion in easy access accounts, which represents over 86% of the whole cash savings market.

On top of this, there is a further £256.7 billion in accounts that pay no interest at all, most likely non-interest paying current accounts. So that is over £1.2 trillion pounds!

And it’s not just cash in current accounts that is languishing with high street banks. Although the actual amounts are not publicly available, in the last Financial Conduct Authority study the City regulator admitted that “the large personal current account providers have considerable advantages because they can attract most easy access balances despite offering lower interest rates.”

So a lot of the money in easy access savings accounts is also being held with the high street banks and these accounts are paying some of the worst rates on the market, as low as 0.01%.

While these high street accounts continue to pay almost nothing, there has been somewhat of a surge in the rates paid on the best easy access accounts.

Before the Pandemic caused the Bank of England to cut the base rate to 0.10% back in March 2020, the best easy access accounts were paying up to 1.41% - and we thought that was low. Little did we know just how bad it would get.

In January 2020 Shawbrook Bank’s Easy Access Account Issue 17 was paying 1.41% AER on balances of £1,000 and above – and the average of the top five accounts was 1.38%.

However, after the base rate cuts, best buy rates started to fall heavily until they hit a low point in April/May 2021. At that point the best rate was just 0.45% AER.

The good news is that things have improved somewhat over the last few months and although our recent leader, the Aldermore Double Access Account Issue 1 paying 0.75% has now been withdrawn from sale, the new best buys are the Investec Online Flexi Saver paying 0.71% AER, which has a minimum balance requirement of £5,000 and Cynergy Bank’s Online Easy Access Account (Issue 43) paying 0.70% which you can open with just £1. 

On a balance of £50,000 you could now earn £355 in interest, as opposed to £225 if you took out and retained the best rate back in May, so it's definitely worth the switch, even more so if you have cash sitting with your bank earning almost nothing.

Take a look at our Easy Access Best Buy table for more information.

Cash Platform Raisin UK now has a number of Easy Access accounts available, but the best paying account is with Private Bank Brown Shipley – which is available via the Platform, not directly with the provider.

The rate on this account has recently increased from 0.45% to 0.61% for both new and existing customers, and whilst not currently on our best buy tables, as we have reported before, Raisin UK offers a bonus for new customers opening and funding an account with at least £10,000 for the first time.

On a deposit of £10,000, this would make the Raisin/Brown Shipley account market leading, as on top of the £61 in interest you would earn over 12 months (assuming the rate remains at 0.61%), add the £50 bonus on top and this equates to a return of 1.11% AER.

But it’s important to realise that you need to request the bonus. Details of how to do this are on the Raisin UK website.

Of course, if you deposit larger amounts, as the bonus remains at £50, the benefit is diluted. For example, if you were to deposit £85,000, with an interest rate of 0.61% you would earn £518.50 in interest. Add the £50 bonus, that means taking home £568.50 which is equivalent to 0.67% AER.

Even if you don’t qualify for this bonus, it shows that if you have your money in a poor paying account, you could earn more if you shop around and switch. And in the case of easy access funds, it’s easy to keep your money on the move as you needn’t wait to get hold of your money.

It doesn't always pay to switch though. You might be lucky enough to have your cash in a closed account that is still paying a highly competitive rate, such as the Shawbrook Bank Easy Access - Issue 19 which was available in March 2020. That account is still paying the same rate of 1.21% AER. Even the aforementioned Issue 17 of this account is still earning 0.75% AER. 

Unsurprisingly, with rates like this,  Shawbrook Bank was the winner of the Best Savings Provider for Existing Customers  in our recent Savings Champion Awards, as well as the Best Savings Provider overall.

However, if you're not one of these lucky ones, vote with your feet and move your money.

*We are occasionally paid by some providers if you click through from our Best Buy Tables and open a savings or current account with them. We will never accept a payment that compromises in any way our independent, whole of market approach to providing information on savings products. For clarity we will indicate those companies who remunerate us with an asterisk (*).