Rates Rundown: It’s been all about cash ISAs this week, with other areas of the market falling strangely quiet…

17th March 2018

Overall It’s been a quiet week in the savings market this week, with nearly all the action taking place in the cash ISA arena - but that is not to say that there aren’t still good deals to be had elsewhere.

One of the first significant changes of the week was the launch of a new notice cash ISA from Coventry Building Society, entering our variable rate cash ISA best buy table as a result.

Also launched was a new market-leading one year fixed rate cash ISA from OakNorth Bank.

Finally at the tail end of the week, Al Rayan Bank launched a competitive new easy access cash ISA and one year fixed term ISA – both of which now appear in our Sharia account best buy table.

For the rest of this week’s rundown we will go through some of the other top accounts currently available, concentrating on two of the most popular categories – Fixed Rate Bonds and Easy Access Accounts.

If you enjoy reading our Rates Rundown each week, make sure you also sign up to our Rate Alert emails, for a regular update on the latest best buy accounts, as they hit the market.


Variable Rate Cash ISAs

New this week is a 30 day notice cash ISA from Coventry Building Society that pays 1.25% tax free/AER.

The new account is only beaten by Charter Savings Bank's 95 day cash ISA (1.31% tax free/AER) and Nationwide's Single Access ISA (1.30% tax free/AER).

Also new this week is an Instant Access Cash ISA from Al Rayan Bank, paying an expected profit rate of 1.22% tax free/AER, next best after Nationwide and a less restrictive option in terms of withdrawals.

The key point to note is that this account is Sharia compliant, so pays an expected profit rate, rather than interest. For more on how Sharia compliant accounts work, please refer to our recent article here.

For further information and to view other leading variable rate cash ISAs, please refer to our variable rate cash ISA best buy table.


Fixed Rate Cash ISAs

Although there wasn’t a huge amount of activity in this area considering that the end of the 2017/18 tax year is nearly upon us, there was some movement at the top end of the market.

The key change came from OakNorth Bank, now paying 1.52% tax free/AER on its one year fixed rate cash ISA and leaping straight to the top of our best buy table.

The account can be opened online with a minimum of £1,000 and transfers in of existing cash ISAs are accepted.

Al Rayan Bank also launched a new 12 Month Fixed Term Deposit Cash ISA paying an expected profit rate of 1.50% tax free/AER, which now appears in our Sharia account best buy table.

In the two year best buy table, Paragon and Charter Savings Bank share top spot – both paying 1.67% tax free/AER.

Both accounts can be opened and managed online only, with a minimum balance of £500 from Paragon and £1,000 for Charter Savings Bank. Both providers accept transfers of previous cash ISAs into these accounts.

Virgin Money leads the way for three years (2.00% tax free/AER). Accounts can be opened online or there is a branch and postal version available at the same rate. Transfers into the account are accepted and it can be opened with just £1.

Finally, for those looking for a longer term, Charter Savings Bank and United Trust Bank both offer the top rate of 2.25% tax free/AER for five years.

Charter Savings Bank accepts transfers of previous ISAs into this account and it can be opened online with a minimum of £1,000.

United Trust Bank requires a minimum opening balance of £15,000 and only accepts transfers in of previous ISAs, so new ISA money cannot be deposited into the account.

To view the full range and review other top rates currently available, please visit our fixed rate cash ISA best buy tables.


Fixed Rate Bonds

Unusually for this competitive area of the savings market, there were few changes of note this week, however a number of the top rates from the last few weeks remain in place to be considered.

Among shorter term fixed rate bonds, Ikano Bank leads the way for one year (1.85% gross/AER) and two years (2.10% gross/AER).

Accounts can be opened online with a minimum of £1,000. It is important to note that deposits held with Ikano Bank are covered up to the value of £85,000 by the Swedish Deposit Insurance Scheme, which is the Swedish equivalent of the UK Financial Services Compensation Scheme (FSCS). For more information on this, please call one of our advisers.

Matching Ikano Bank for one year is Investec, although a higher amount of £25,000 is required to open the account.

If you are looking at longer term fixed rate bonds, Vanquis Bank dominates, offering the top rate for three, four and five year terms.

The three year bond pays 2.30% gross/AER, the four year bond is 2.47% gross/AER and the five year bond pays 2.56% gross/AER.

Its dominance in the five year table however is challenged by Secure Trust Bank, matching its rate and joining them in joint first position.

For further information or to view other options that are currently available, please refer to our fixed rate bond best buy tables.


Easy Access Accounts

The easy access market is still dominated by two key players. Firstly, the consistent RCI Bank, paying 1.30% gross/AER on its Freedom Savings Account.

The other provider, Virgin Money, entered the table last week with its improved Double Take E-Saver Issue 4 – also paying 1.30% gross/AER.

However, there is a key difference between the two accounts – with Virgin’s account you can only make two withdrawals per calendar year. Fine for those that won’t need more regular access to their money, but for others it may be a case of looking elsewhere.

For more information on these two accounts and for other options, take a look at our easy access best buy table.


For more information on any of the accounts above or for other options, call our Bath-based Savings Experts on 0800 011 9705. We’d love to hear from you.

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