🔔 Rates Rundown: ISA season under way as improvements ramp up

With less than a month to go before the end of the 2018/19 tax year, providers have been starting to set out their stalls to pique savers’ interest.

Some of the big names joined the race, with Santander and Coventry Building Society launching market-leading easy access cash ISAs.

>> Top-paying variable rate cash ISAs

Santander was also active in the fixed rate cash ISA arena, along with new best buys from Wesleyan Bank and Kent Reliance.

>> Top-paying fixed rate cash ISAs

There was interesting news this week from The Family Building Society, which extended the funding deadline of its market-leading account.

>> Latest easy access best buys

There were fewer improvements amongst fixed rate bonds, although PCF Bank caught the eye with a new market-leading two year offering.

>> What are the best fixed rate bond rates?

Meanwhile, Sharia compliant accounts continue to offer some of the very best rates available, in many cases higher than the standard fixed rate equivalents.

>> Sharia fixed term account best buy table

Last but not least, as we lead up to the new tax year, NS&I improved the rate on offer on its Junior Cash ISA – a rare but welcome change in this area of the children’s savings market.

>> What are the best junior cash ISA rates?

For an overview of the whole savings market and to look at the top options in all categories, make sure you consult our independent best buy tables and if you want to keep up to date with best buy rates as they hit the market, sign up to our Rate Alert emails.

Variable Rate Cash ISAs

Some of the bigger names joined the ISA race this week, with Santander and Coventry Building Society launching joint market-leading easy access cash ISAs.

Both ISAs are paying 1.50% tax free/AER - although the Santander cash ISA is only available to new and existing 1|2|3 World or Santander Select customers.

The ISA from Coventry is available to all, but the rate does include a 0.35% introductory bonus until 31 July 2020.

These accounts join Kingdom Bank at the top, with its One Year Base rate plus cash ISA still paying 1.50% tax free/AER.

As the name of the account suggests, the interest rate tracks movements in the Bank of England base rate – so it will go up or down with any base rate changes during the one year term.

It is worth noting that you cannot make withdrawals within the term, although you can transfer the ISA to another provider, if you pay the required penalty.

For further information on these accounts and the rest of our top five, please refer to our variable rate cash ISA best buy table.

Fixed Rate Cash ISAs

Santander also improved its two year fixed rate cash ISA and is now paying 1.90% tax free/AER, entering our best buy table in joint fourth place – matching Kent Reliance, another new entrant this week.

Again, Santander’s ISA is only available to new and existing 1|2|3 World or Santander Select customers.

However, more noteworthy moves came from Wesleyan Bank, which now leads the way in both our one and two year best buy tables.

The newly-improved one year option pays 1.76% tax free/AER and the two year option pays 1.96% tax free/AER.

Making up a trio of improvements, Wesleyan’s three year option (1.98% tax free/AER) went straight into our table in second place. Charter Savings Bank still leads the way, paying 2.05% tax free/AER.

To view our top five accounts across the full range of terms, please refer to our full fixed rate cash ISA best buy tables.

Easy Access Accounts

Not many changes this week, but the key news came courtesy of market leader, The Family Building Society.

With the deadline to add money to its top-paying easy access account just days away, the provider extended the deadline for savers keen to take advantage of the market-leading 1.51% gross/AER rate.

The account now has a funding cut-off date of 29 March 2019, after which you cannot add further funds to the account and there is a comparatively high minimum balance requirement of £15,000.

Next up is Virgin Money, paying 1.50% gross/AER; however, its Double Take E-Saver does restrict you to just two withdrawals per year – so may not suit everyone.

Then it’s Marcus by Goldman Sachs, which also pays 1.50% AER but features an introductory bonus as part of the headline rate.

So, with a number of introductory bonuses and other restrictive terms and conditions evident amongst many of the top-paying accounts, Shawbrook Bank (1.43% gross/AER) offers something a little more straightforward – albeit at a lower rate.

Further information on the leading accounts can be found in our easy access best buy table.

Fixed Rate Bonds

There wasn’t a huge amount of activity in this area of the market this week, with PCF Bank making the only move of note.

The provider’s new two year fixed rate bond is now joint top of our table, paying 2.26% gross/AER, alongside Axis Bank UK*.

Elsewhere, there is a five-way tie at the top for one year, with the access bank UK*, FCMB Bank (UK)*, FirstSave, Ikano Bank and Wesleyan Bank each paying 1.95% gross/AER.

In our three year table, there is a four-way tie, with Aldermore*, ICICI Bank*, Tandem and new kid on the block Arbuthnot Direct all paying 2.40% gross/AER.

If you are looking for a longer-term fixed rate bond, Vanquis Bank is paying a market-leading 2.59% gross/AER for five years.

For full information on each of these accounts and for a range of other options, please refer to our full fixed rate bond best buy tables.

Sharia Fixed Term Accounts

An alternative type of fixed term account to consider, Sharia accounts currently pay some of the best returns on the market.

One of the key players is Gatehouse Bank, with market-leading versions of its two year, three year and five year fixed term accounts.

>> 2 year Fixed Term Deposit: 2.45% gross/AER*

>> 3 year Fixed Term Deposit: 2.50% gross/AER*

>> 5 year Fixed Term Deposit: 2.75% gross/AER*

In addition, these accounts are available through the Raisin UK savings platform, where a welcome bonus of up to £100 is available for new customers.

>> Find out more about Raisin UK

For those looking for a shorter term, BLME is top of the pile, paying 2.20% gross/AER – head and shoulders above the rest of the one year fixed term market.

Al Rayan is also in amongst the top rates, matching Gatehouse Bank for two years (2.50% gross/AER) and offering a competitive 18 month option, which pays 2.30% gross/AER.

Please refer to our Sharia fixed term accounts best buy table for more information on the accounts above.

>> How do Sharia compliant accounts work?

Junior Cash ISAs

There is rarely much activity to report in this area of the market, but NS&I grabbed the headlines by improving the rate on its Junior ISA to a much more competitive 3.25% tax free/AER – taking second position in our table.

However, Coventry Building Society still dominates, paying 3.60% tax free/AER. 

For further information on these accounts, please refer to our junior cash ISA best buy table.

If you would like any help with your savings, why not give one of our Bath-based experts a call on 0800 011 9705, we’d love to hear from you.

*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 (*).

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