🔔 Rates Rundown - as inflation leaps, savings flatten

Author: Anna Bowes
17th September 2021

I’m afraid that momentum has continued to slow. But with inflation at 3.2% which is the highest level since early 2012, it’s important to make your cash work as hard as possible. So keep a close eye on what's happening in case you miss something.

RATES ARE CORRECT AS AT THE TIME OF PUBLICATION (17/09/2021). All up-to-date rates can be found on our Best Buy tables.

Easy Access

It’s been really quiet in the easy access best buy table – with just one addition made over the last two weeks.

Buckinghamshire Building Society has launched a new restricted access account. The Single Access Saver is paying 0.60% AER on balances from £100 – so goes into joint second place and can be opened in branch or by post. However, as the name suggests only one withdrawal is allowed between 1st January and 31st December each year, so is not appropriate for those who need regular access to their cash.

Notice Accounts

There have been two more best buy accounts added to the notice account table since our last report and not only does this mean that the best rate is the highest we’ve seen since October last year, but all of the top five are now paying more than 1%!

Oxbury Bank was the first provider to launch a new account paying 1.06% AER - the Personal 120 Day Notice Account Issue 1. And on Friday, OakNorth Bank reacted by launching its 120 Days Notice Deposit Account – Issue 12, matching Oxbury’s rate of 1.06% AER.

Could now be the time to consider one of these accounts that pay more than easy access accounts, but with greater flexibility than a fixed rate bond?

Fixed Rate Bonds

Unfortunately, the relentless competition that we have been enjoying recently has certainly waned a little and we’ve seen a few more providers such as Allica Bank, Charter Bank, Zopa and Tandem, launching new bonds with lower paying rates.

That said, the good news is that Atom Bank has remained in its top spot on the one, two and five year tables, and after Tandem Bank withdrew its top three year bond, Atom was happy to take its place.

Turkish Bank, Isbank via Raisin UK, launched new one, two, three and five year bonds that have all gone into the best buy tables paying 1.30%, 1.70%, 1.75% and 1.80% respectively. Plus of course the £50 welcome bonus for new Raisin customers.

JN Bank has been the only other provider to launch new higher paying three, four and five year bonds paying 1.74% for three and four years and 1.75% for five years.

So, thanks to Atom Bank, JN Bank and Isbank via the Raisin UK platform which have been the key competition recently, the rates available haven’t dropped too much.

We can only hope that with inflation continuing to rise and with a few new banks waiting in the wings to launch into the retail savings market, that the competition will start again.

Fixed Rate Cash ISAs

Once again there has been quite a bit of activity in the short term fixed rate ISA tables, some good, some bad.

Over one year, Secure Trust Bank went into the top spot briefly with a one year ISA paying 0.95%, knocking Hodge Bank into 2nd place. However, it was withdrawn after just four days. A further blow was followed the next day when Hodge Bank withdrew its 0.90% ISA and replaced it with a lower paying 0.80% AER.

This left Paragon, Charter Savings Bank and Coventry Building Society in joint top spot, all paying 0.85% until OakNorth Bank pipped them all with its new 12 Month Fixed Rate Cash ISA paying 0.86% AER.

Secure Trust Bank and Hodge have been the providers to shake things up a bit in the 2-year table as well. Secure Trust Bank increased the rate on its 2-Year Cash ISA to 1.15%, but as with the one year, this was quickly withdrawn. Luckily Hodge Bank stepped in to replace it and at the time of writing is till at the top with its 2 Year Fixed Rate Cash ISA (Online) paying 1.15% tax free/AER on balances of £1,000 or more.

There has been far less activity in the three and five year fixed rate ISA market, although once again Secure Trust Bank made a brief dash to the top in the three year cash ISA table, paying 1.25% for just a few days before withdrawing and leaving UBL in the top spot paying 1.21% tax/free AER.

Variable Rate Cash ISAs

As with the easy access table, there is very little to report about the variable rate ISAs. There have been a couple of new accounts though, one from the Leeds Building Society paying 0.55% AER and one from Coventry Building Society, also paying 0.55%.

But the top spot is still occupied by Cynergy Bank with its Online ISA (Issue 16) paying 0.60% tax free/AER

Sharia Fixed Term Accounts

Al Rayan Bank has been the key player for Sharia compliant accounts in the last couple of weeks, by launching numerous market leading accounts. The two and three year bonds are paying 1.76% and 1.81% respectively – these rates are better than the equivalent standard fixed rate bonds, so worth a consideration.

And finally, BLME has also re-entered the Sharia Fixed Term Bond table paying an expected profit rate of 1.70% AER on its 5 Years Premier Deposit Account - so quite a bit less than the standard fixed rate bonds available.

That’s it for this week – I hope to bring you more good news next time. Let’s hope the competition ramps back up again. In the meantime keep an eye on our best buy tables.