A pause in the base rate hikes and the withdrawal of the NS&I 1-yeasr Guaranteed Growth bond that had been offering 6.20% AER has seen a flurry of activity but not in a positive way. On the plus side, top variable rate accounts are still jostling for top spot, so there are some good rates to be found.
RATES ARE CORRECT AS AT THE TIME OF PUBLICATION (06/10/2023). All up-to-date rates can be found on our Best Buy tables.
Even though the base rate increases have paused, there has continued to be some good competition in the Easy Access table. Strangely, most of this occurred after the last Monetary Policy Committee (MPC) meeting when 5/4 of the members voted to keep base rate at 5.25%.
The day of the MPC meeting, Leeds Building Society launched the latest issue of its Limited Issue Online Access account paying 5.10%, taking it to the top of the table.
And Secure Trust Bank increased the rate on its Access Account Issue 9 to 5.03% AER
Nottingham Building Society was the next to challenge the top spot launching its Limited Issue Easy Access account paying 5.10% - but this was soon pushed down the table by Shawbrook Bank, increasing the rate on the Easy Access Account Issue 36 to 5.11% and then Coventry Building Society launched Online Saver (6) paying 5.20% AER.
As we end the week, Coventry is still leading the pack, with Virgin Money’s latest issue of its Defined Access eSaver Issue 19 taking second place paying 5.12% AER. In the last few weeks, the average of the top five easy access accounts has increased from 5.01% to 5.13% - so plenty to choose from.
1 Year
It’s continued to be quiet in the 1-year table, with no-one directly challenging NS&I for the top spot. That said, a new bank joined the table, Streambank, paying 6.10% and taking 4th spot at that stage.
Oxbury Bank and Nottingham Building Society’s Beehive Bonds both upped the rates on offer to 6.11%, pushing Streambank out of the running just a few days later.
But as we ended the week, NS&I withdrew the 6.20% bond and that saw Oxbury Bank withdraw its offering too which was briefly in joint top spot with Union Bank of India UK paying 6.11% AER. However, Smart Save made a return to the top table and whilst not pipping the rest of the field by its customary 0.01%, it did match Union Bank of India paying 6.11% also.
The NS&I bond had resurrected some competition in this market, so the concern is that without it, things will begin to dwindle. Watch this space.
2 Years
There is very little to report in the 18 months/2-year table – in fact one of the top five is now only paying 6% following the withdrawal of the 2-year bond from Aldermore - reducing the quintet of bonds paying 6.05% to a quartet.
Longer Term Bonds
It’s a mix of fortunes in the 3-year and 5-year tables, with the top 3-year bond paying slightly more than was available a couple of weeks ago, whilst the top 5-year bond is paying a little less.
It’s JN Bank that has returned triumphant in both cases, paying 5.97% for 3-years and 5.80% for 5 years. Other than that, there is little to report. After all the excitement of the last few months, all in all, it’s pretty disappointing.
The generally quieter feeling has also reached the Cash ISA tables with the top rates on offer falling across the 1 – 3-year terms and the 5-year top rate sticking fast.
That said, the tax-free rates on offer are paying more than the net rates on the equivalent bonds, offering opportunities to those looking to protect the interest they are earning on their cash from the tax man.
The top rate over 1-year increased briefly with an ISA launched by UBL UK paying 5.86% – UBL UK is a provider that is well used to being at the top. But as we ended the week, this account was withdrawn, leaving OakNorth Bank offering the best rate of 5.80%.
Over 2-years, the news is not as exciting and although Zopa is still offering the best rate, it has dropped from 5.66% to 5.61%. But this is down from 5.81% with Close Brothers in the middle of last month.
In the 3-year cash ISA table, the story is almost identical. Once again Zopa ends the week at the top with an ISA paying 5.51% AER – but this is down from its previous offering of 5.61%.
Over in the 5-year table the top spot, again with Zopa, has this time dropped quite a bit, from 5.26% to 5.05% and the overall average of the top five has fallen from 5.24% three weeks ago, to its current level of 5.01%. This is due to the withdrawal of several other ISAs paying 5.25% - leaving those paying just 5% and 5.01% instead.
There’s better news in the Easy Access Cash ISA table with some good improvements over the last couple of weeks - the top rate on offer is still with app-based moneybox, but the rate has now increased to 5%. The thing to watch out for with this account though, is that you can’t be sure exactly who your cash will be deposited with. We have been able to confirm that for their Cash ISA, moneybox currently works with HSBC Bank PLC and Santander UK Plc and while strangely they can’t confirm exactly who the money will be distributed with, they confirm that savers “should assume that up to 50% of their Cash ISA balance is held with any one of the partner banks we use.” We are still unable to confirm exactly what that means!!
There have been some other good improvements too. Coventry Building Society launched a Four Access ISA (Online) paying 4.90% which went to the top at the time. Virgin Money has launched two issues of its Defined Access Cash E-ISA – issue 21 paying 4.76% and then later Issue 22 paying 4.91%. And Shawbrook Bank has increased the rate on its Easy Access Cash ISA Issue 26 twice recently, firstly to 4.81% and then as this week ended up into 2nd place paying 4.93% - for new and existing customers.
Like the standard easy access table, it’s good to see the best buys on offer continuing to increase so, whatever you do, please review the interest rates you are earning and switch if you can do better.
Whilst there has certainly been a slowdown in the competition on some of our tables, there are still some great rates to be found, especially if you have cash languishing in a poor paying account. So, take a look at our best buy tables, and vote with your feet if you are not earning as much as you can.
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