🔔 Rates Rundown - even more barriers broken

Author: Anna Bowes
01st July 2022

Rate rises have continued unabated following last month’s base rate rise. Although the top paying easy access account has not increased, there have been some other barriers broken and there are now plenty of bonds available that offer in excess of 3% - even as high as 3.30% if you are happy to tie up your money for five years. Read on for more detail and to see this week’s movers and shakers.

RATES ARE CORRECT AS AT THE TIME OF PUBLICATION (01/07/2022). All up-to-date rates can be found on our Best Buy tables.

Easy Access

Although once again there has been no further challenge for the top spot, a number of increases among the top five means that all are now paying 1.40% or more – the first time this has been the case since the end of 2019. At that point the base rate was 0.75% - so lower than it is today. Perhaps there’ll be more to come?

Firstly, a dual move came from Zopa and Sainsbury’s Bank. The former upped the rate for new and existing customers to 1.40% (although savers can now only deposit up to £50,000 in the account). Sainsbury’s launched Issue 30 of its Defined Access Saver – also paying 1.40% AER on deposits of £1,000 or more. As the name suggests, there is a limit to the number of withdrawals that are allowed each year. If you make four or more withdrawals, the rate will reduce to 0.80% for the remainder of the year.

The last move of the week came from Al Rayan – again passing on a rate rise to new and existing customers with its Everyday Saver Issue 2. This account is now paying 1.45% and is in third place, leaving Chase and Virgin at the top paying 1.50% and 1.56% respectively.

However, those trying to open a Chase account at the moment, may find themselves in a waiting room for a number of days if not weeks, as Chase has struggled to manage the demand for its account.

Notice Accounts

There has also continued to be some positive moves in the Notice Account Best Buy table.

Allica Bank found it’s way back into the top 5 by increasing the rate for new and existing customers on Issue 1 of its 95-day notice savings account to 1.80% AER which made it the joint highest paying three-month notice period, along with Oxbury.

Oxbury Bank then launched Issue 3 of its 180 Day Notice Account paying 1.95% AER – which put it in the top spot. But that wasn’t the end.

As we finish the week DF Capital and Raisin have taken the crown for the 180 Day and 95 Day notice periods. DF Capital is paying 2% on its newly launched 180 Day Notice Account (Issue 1). A year ago, the highest rate on offer was 0.80%.

QIB UK via the Raisin Cash platform has also launched a new issue of its 95 Day Notice Account paying and Expected Profit Rate of 1.95% AER. A key thing to watch out for with notice accounts on the Raisin platform, is that when you make a withdrawal, you have to actually close the account – no partial withdrawals are allowed.

Another thing to be aware of is that you must deposit the amount you state when you apply for each account you choose. If you deposit less, after 60 days the account will be closed and your money returned with no interest – and you will be unable to deposit more than stated. This is the case with notice and fixed term bonds via the platform.

Fixed Rate Bonds

Once again, we have seen several providers battling it out for a spot in our fixed rate bond best buy tables over the last two weeks and many of the same names that we have become familiar with.

Starting in our one-year table, Raisin UK is the star performer and straight to the top a new offering from a new provider, National Bank of Egypt UK paying 2.70% AER. This provider is part of the UK Financial Services Compensation Scheme, so your money is protected. And remember that if you are new to Raisin, you could be eligible for a £25 welcome bonus if you apply using our link, boosting the effective return.

There are some Terms and Conditions though. If you are eligible for a bonus, you must claim it by emailing [email protected] with the subject 'Raisin UK Bonus' - using the same email address you used to register. In the email, please add your full name. You can make the claim as soon as you have been notified that your savings account has become active and fully funded.

Behind Raisin there has been a bit of a battle for 2nd place.

Allica bank was the first out of the blocks, matching Atom Bank with a rate of 2.60% - at the time moving into a joint top position. But Kent Reliance came along and knocked them both into joint 2nd place by the smallest of margins paying 2.61% AER. But Allica had not finished - and at the last moment, launched a new bond paying 2.65% - claiming 2nd place.

Kent Reliance has now been joined by Monument Bank with its latest 1-year bond, also paying 2.61% AER – so now all of the top five are paying 2.60% or more.

Looking at our two-year table, we have again seen a barrier broken – this time the 3% barrier. 

DF Capital and Monument kicked off the battle by both launching bonds paying 2.95%, both climbing to joint 1st place. But the following day Allica Bank pipped them both, paying 2.96%. Smart Save joined in the fray, again overtaking by the smallest margin offering 2.97% - tantalisingly close the 3% mark. Castle Trust was the first to make it – launching a bond paying 3.03% - but the next day Monument Bank decided it want to lead the way launching a bond paying 3.05% - and it remains in this lofty position as we head into the weekend. The final moves in the two-year table came from Charter Savings Bank which launched a 3% bond, and Allica who retaliated with a bond paying 3.01% - so the top four all now pay 3% or more – first time for a decade.

It was a similar story in the three-year bond table. A couple of weeks ago the top rate was 2.95% - today all of the top five are paying 3% or more. This time it was the Buckinghamshire Building Society that led te way – although no sooner had the Building Society launched a bond paying 3%, there was flurry of providers following suit. The next day Zopa launched a bond paying 3.01%, Smart Save was paying 3.02% but PCF Bank knocked the socks off the other by paying 3.10% AER.

This seemed to quiet the activity until Monument Bank took the top spot with its latest 3-year bond paying 3.11% - and there it remains.

And finally in the fixed rate bond market, we look at our five year table. Once again Monument Bank has jumped up to the top of the table offering 3.30% - the highest rate that’s been on offer for a decade (if we ignore the NS&I ‘Pensioners Bonds’ that were briefly available in 2015 for the over 65s.

PCF Bank had a couple of goes to try and lead the way, launching firstly a 3% bond to join the Ahli United bond available via Raisin. But this were overtaken by both Monument Bank with a bond paying 3.05%, then Zopa paying 3.11%. PCF retaliated with a bond paying 3.25% and that remains in 2nd place – since the aforementioned current offering from Monument remains at the top.

All in all, another busy period for best buy fixed rate bonds and yet more barriers broken!

Fixed Rate ISAs

Over the last two weeks we have seen some jostling across our fixed rate ISA tables for the leading spots, although the activity has not been a busy as with the bonds. 

First up, Virgin Money launched a new version of its one year cash ISA paying 2.06% - to take the top spot. However it was soon was knocked down a peg for a few days by Paragon Bank which launched a market-leading ISA paying 2.10% AER. This was only available for four days before being withdrawn and leaving Virgin back at the top of our table.

Over two years Virgin once again kicked off the activity when it launched a market-leading ISA paying 2.36% AER. However, in a mirror of the one-year ISA table activity, Paragon knocked Virgin off the top spot again with its current issue paying 2.40%. But the battle wasn't over there - first Castle Trust Bank launched a 2-year ISA paying 2.42%, then as the week ended, Charter Savings Bank ended up at the top of the table with its new ISA paying 2.45%.

On to our three-year fixed rate cash ISA best buy table and we’ve spotted an account that doesn’t quite fit, but should be recognised nevertheless. Coventry Building Society has a 30-month Fixed Rate ISA which is paying 2.75% - so higher than the best 5-year ISA. While it is called the 30 Month Fixed Rate ISA (issue 1) it has a hard maturity date of 2nd February 2025, but the rate is quite a bit higher than the next. Paragon is the key competitor paying 2.55%, fixed for three years from the date it is opened.

Finally, there has been less activity in our five-year best buy table. The previous market leader, UBL paying 2.60%, has been joined by Secure Trust Bank, Paragon and United Trust Bank – so there are plenty of options for those prepared to tie up their cash for five years.

Variable Rate ISAs

This table has been very quiet, and no-one has challenged Aldermore for the top spot. Its 30 Day Notice Cash ISA Issue 12 paying 1.40% is still the best rate around, with Paragon’s restricted access Triple Access ISA Issue 8 leading the way for immediate access ISAs paying 1.35% – albeit restricted to three penalty free withdrawals a year on this account.

Sharia Fixed Term Bonds

BLME has remained dominant for much of the last two weeks, however Raisin is never far from the best buy table! This week it introduced a 1-year bond paying 2.61%, an 18 month bond paying 2.85% and a 2-year bond paying 3% - all via QIB UK. 

However, BLME fought back at the last minute, increasing its 1-year offering with a new bond paying 2.65%.

These rates are all competitive, but at the moment better rates can be found with standard Fixed Rate Bonds.

It would be good to see the Sharia providers pushing back.

It's great to see best buy rates continuing to improve - let's hope there is more to come. Keep a close eye on our Best Buy tables for up to the minute information.