Savings Rate Rundown
We have seen a selection of new best buy accounts hit the shelves in the last few weeks, with interesting new additions to the Easy Access, Fixed Rate Bond, Variable Rate ISA and Fixed Rate ISA categories.
Challenger banks continue to dominate the best buys as the high street brands remain largely conspicuous by their absence from the savings accounts sections of the best buy tables.
Whilst the news is generally more positive for those looking to open a new account, providers continue to cut rates for existing account holders, which only goes to stress that point that you have to keep your money on the move to stay in the best rates. The recent announcement by NS&I about its Direct ISA is the latest in a whole host of rate cuts. September has seen 142 accounts where the rate has been cut, meaning that in the last three months alone, holders of over 500 accounts have been affected. The most effective way to combat this practice is to vote with your feet, moving away from uncompetitive accounts into better paying alternatives. Our free Rate Tracker Service can of course help with this!
NS&I have announced that it will be reducing the rate on its Direct ISA from 1.50% to 1.25% tax free/AER from 16th November 2015, affecting both new and existing account holders.
A well-known provider has made changes to its easy access offering, appearing in our best buy table as a result.
Post Office has launched an Online Saver Issue 16 paying 1.61% gross/AER (the previous issue paid 1.40%). This account went straight to number 3 in our easy access table.
The Post Office has also launched new versions of the majority of its savings range, the most noteworthy of which are the 1 Year Online Bond which pays 2.01% gross/AER (the previous issue paid 1.93%) and the 2 Year Online Bond which pays 2.31% gross/AER (the previous issue paid 2.02%), both of which now appear in our fixed rate bond best buy tables.
In addition, its Online ISA Easy Access Issue 3 paying 1.51% tax free/AER now appears in our Variable Rate ISA Best Buy Table.
We have also seen more changes in the fixed rate bond best buy tables.
Secure Trust Bank has launched new versions of its 7 Year Fixed Rate Bond paying 3.15% gross/AER and 5 Year Fixed Rate Bond paying 3.11% gross/AER. Both bonds are market leading for the respective terms, although interest must be paid to a separate account, it cannot be added to the bonds, so may not be suitable for those looking to accrue interest in the accounts.
Paragon Bank has increased the rate on its 1 and 3 year fixed rate bonds for new accounts opened. The 1 Year Fixed Rate Bond pays 2.01% gross/AER (the previous issue paid 1.91%) and the 3 Year Fixed Rate Bond pays 2.56% gross/AER (the previous issue paid 2.45%). Both bonds now appear in our fixed rate bond best buy tables.
Charter Savings Bank has updated selected fixed rate bonds. The 1 Year Fixed Rate Bond pays 2.07% gross/AER (the previous version paid 2.06%) and the 2 Year Fixed Rate Bond pays 2.32% gross/AER (the previous version paid 2.28%). Both bonds are best buys, with the 1 year bond market leading.
Hampshire Trust Bank has withdrawn its 2 year fixed rate bond paying 2.30% and replaced it with a new version paying 2.35% gross/AER, which is now second place in our best buy table.
Meanwhile, providers have also been making changes to their cash ISA ranges
Virgin Money has withdrawn its Defined Access ISA Issue 2 paying 1.51% and has replaced it with Issue 3 paying 1.56% tax free/AER. The account has now moved into second place in our variable rate ISA best buy table.
The provider has also launched a higher paying version of its 1 Year Fixed Rate Cash ISA paying 1.81% tax free/AER, remaining in second place in the best buy table.
Mansfield Building Society has launched a 2 Year Fixed Rate Cash NISA (2nd Issue) paying 2.10% tax free/AER and a 60 Day Notice Cash NISA (1st Issue) paying 1.55% tax free/AER. Both of the ISAs are now in our Best Buy Tables, with the 2 year market leading, although you can’t transfer previous ISAs into the accounts.