Going postal? You can still earn first class rates.

Author: Anna Bowes
28th June 2019

Feedback from savers using our services indicate that there are still plenty of people out there who prefer to open accounts using more traditional methods – in particular, by post.

The good news is that, while many top-paying accounts are accessible online only, the compromise in returns on postal accounts is often not as stark as some will fear.

Postbox

Challenger providers such as The Access Bank, Bank & Clients, Hodge Bank and PCF Bank among others, are providing a lifeline to savers who think they are excluded from access to competitive accounts.

For more traditional savers, while the majority of best buy easy access accounts are online only, fixed rate bonds offer more choice without a significant compromise.

None of the top 10 easy access accounts offer a postal option and there are only three postal accounts in the top 20. Savers would have to sacrifice 0.20% gross per annum if they wanted to open and manage their account by post. That said, there are also a couple of accounts that can be opened and managed by telephone paying a little more.

Of the top 20 one year fixed rate bonds, five accounts offer a postal option and the rate on the best account is just 0.10% lower than the leading rate of 2% from Metro Bank (the latter can also be opened in branch for those who have a Metro Bank nearby).

Over longer terms, the loss is even less. The market-leading two year fixed rate bond is just 0.02% higher than the best postal account from The Access Bank. For three years the difference is only 0.01% per annum and over four, five and seven years, the very best buys are from PCF Bank - another provider which offers a postal option.

On a balance of £10,000, 0.01% represents a loss of just £1 in interest over 12 months, for those choosing a more traditional way to deposit cash.

Recent research from Savings Champion shows that the average of the best one-year bond rate since April 2018 is 2.01%, whereas the average of the top postal option was 1.91% - a difference of just 0.10%, or just £10 per £10,000 deposited.

Key postal providers frequently appear in the top 10, top 5 and, from time to time, even offer the very best rates.

This just goes to show that even if you do prefer to go down more traditional routes, you do not have to resort to the big high street brands, which as usual are nowhere to be found amongst the top rates.

Savers may need to take a well-informed leap of faith - as long as their chosen provider is part of the UK Financial Services Compensation Scheme or European equivalent, there is no reason not to consider trying out an unfamiliar name.

Take a look at our best buy tables to find the best accounts. We try to ensure that at least one entry on each table offers a non online only option. 

Current overall best buy fixed rate bonds v best postal option  
         
One Year Bond Provider AER How it can be opened  
Best Overall Metro 2.00% Online, Branch  
Best Postal The Access Bank 1.90% Post, Online  
Two Year Bond Provider AER How it can be opened  
Best Overall FCMB (via Raisin) 2.22% Online  
Best Postal The Access Bank 2.20% Post, Online  
Three Year Bond Provider AER How it can be opened  
Best Overall Paragon 2.37% Online  
Best Postal PCF Bank 2.36% Post, Online  
Four Year Bond Provider AER How it can be opened  
Best Overall PCF Bank 2.40% Post, Online  
Best Postal PCF Bank 2.40% Post, Online  
Five Year Bond Provider AER How it can be opened  
Best Overall PCF Bank 2.65% Post, Online  
Best Postal PCF Bank 2.65% Post, Online  
Seven Year Bond Provider AER How it can be opened  
Best Overall PCF Bank 2.75% Post Online  
Best Postal PCF Bank 2.75% Post Online  
         
Rates correct at 27th June 2019 - excludes Sharia accounts    
         
Key providers offering best buy postal accounts over the last year
         
Provider Number of times provider appeared in top 10  Number of times provider appeared in top 5  Number of times provider payed best postal rate Number of times provider payed best rate overall
The Access Bank UK 129 30 67 1
Bank & Clients  79 49 63 3
Hodge  Bank 89 40 57 1
PCF Bank 74 48 51 5
Hampshire Trust 45 18 22 1
Charter Savings Bank 35 23 19 1
United Bank Limited 20 16 17 1
Kent Reliance 21 11 14 3
         
Figures compiled on a weekly basis between 6/04/2018 and 31/05/2019  
One, two, three and five year fixed rate bonds (excludes Sharia accounts)  

 

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