RCI Bank does it again - new market-leading rate on its Freedom Savings Account

31st January 2017

Things are looking up. Last week ended with a nice surprise from RCI Bank, smashing the competition yet again. This time it increased the rate on its popular Freedom Savings Account for the third time this month, from its previous rate of 1.02% AER to 1.10% AER. RCI Bank, it seems, has continually been the leader in driving competition in the savings market since it launched with a bang, back in 2015. 

Dare we say that 2017 is showing some green shoots of recovery, beginning with a flurry of activity at the start of the month, with rates on the up for a change.

The Post Office kicked things off at the start of the month, launching a new market-leading easy access account, making it to the top of our table by the smallest of margins. RCI Bank reacted to this move the very next day, bringing itself in line with the Post Office.

The next moves came in the following week, with a new market leading account from Hanley Economic Building Society and then the next day, Nottingham Building Society moving ahead of both RCI Bank and the Post Office. Not to be outdone, RCI Bank increased the rate on its Freedom Savings Account again, matching the rate on offer from Nottingham Building Society.

However, after all this jostling for position in the best buys, the latest increase from RCI Bank means business, with a meaningful jump ahead of its competitors.

Once again it's the challenger banks that are driving the market and thank goodness for them, as frankly where would we be without them? The high street banks have all but given up on savers and yet so much money is still saved with them. We need to think with our feet.

The Freedom Savings Account from RCI Bank pays 1.10% gross/AER and can be opened online with a minimum of £100 so should be available for many savers. Each rate increase this month has been applicable to both new and existing account holders, so if you already hold the account, you will have also benefited from these changes, which is refreshingly fair.

It is worth noting however that deposits held with RCI Bank are not covered by the UK Financial Services Compensation Scheme (FSCS) but are covered up to the value of €100,000 by the FGDR, which is the French equivalent. If you would like more information on this, please call us and we'd be more than happy to explain in more detail.

The hope is this move will stimulate even more competition in the easy access market, which has suffered so badly in recent years, following the introduction of the Funding for Lending Scheme and more recently the Term Funding Scheme.

Savers appear to have favoured the humble easy access account in the last few years, most likely in the hope of being able to benefit from a rise in interest rates, that is so desperately needed. So, this move to improve the rates available is great news. Let's hope we see more of the same in the not too distant future.

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