ICICI BANK has just launched an easy-access savings account paying 1.55 per cent in interest, knocking rivals from the top of the best buy tables.
The last provider to offer a rate of 1.55 per cent was Nottingham Building Society at the end of October, but the deal was so popular that the small provider withdrew it after just two days.
Yet experts expect this account to stay around for a while – but as always there’s no guarantee.
The new HiSAVE Bonus Saver Account by ICICI Bank, currently India’s second largest bank, beats its rivals by 0.05 percentage points.
Since Marcus Bank, the retail arm of investment bank Goldman Sachs, launched its savings account at a 1.5 per cent rate in September 2018, more and more banks have done the same with Virgin Money and West Brom Building Society now also offering 1.5 per cent rates.
ICICI Bank’s account comes with 1.25 per cent interest rate plus a 0.3 per cent bonus for 12 months, so after a year you’ll want to review the account as the rate then drops to 1.25 per cent.
The account requires a £1 deposit, allows unlimited withdrawals and can be opened and managed online.
You must also be at least 18 years old and a UK resident to apply for the account. You can do so via the ICICI Bank website.
Deposits with the bank worth up to £85,000 per person are fully protected by the Financial Services Compensation Scheme.
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Andrew Hagger, money expert at Moneycomms, told The Sun: “There’s certainly been an upturn in interest rates for easy-access savings accounts since Marcus launched its 1.5 per cent deal.
“The market has become far more competitive which is great news for savers and I expect the latest best buy from ICICI Bank to stay around for a while.
“Many of the banks offering best buy deals may not be familiar names but this shouldn’t be a reason for consumers to ignore them.
“The vast majority are covered by the same Financial Services Compensation Scheme (FSCS) which covers balances up to £85,000 – so they are just as safe as high street banks which in the main are offering paltry rates to their loyal customers.
“The ‘Marcus effect’ is positive news for savers and will hopefully lead to even higher returns during 2019.”
Are there any alternative accounts for savers?
THE Sun took a look at the best-paying accounts on the market which will give you the most bang for your buck
- Fixed rate accounts: Fixed-rate accounts will typically offer better rates than normal, easy access accounts, so if you know you can afford to tie your money up for between one and five years, it’ll be worth looking at these type of accounts.
With these accounts you’ll always need to check how much you need to open the account with – some have really high limits which won’t be available to most people.
- Current account savings: Rates are much lower on these accounts than in previous years. Yet you can still beat the easy-access rates above on small amounts, and some even offer security of rate. The advatange is once the account’s opened, these are locked in, regardless of base rate cuts or banks lowering rates.
- Isa accounts: An ISA (Individual Saving Account) is a tax-free way to save or invest. So, if you’re starting to think about saving or investing, it could be a good place to begin. Here’s our guide to the best cash ISA account in 2018.
Rachel Springall, finance expert at Moneyfacts, also expects more providers to increase their rates.
She said: “It’s fantastic to see more competition in the easy access market, especially as many savers would use this type of account because of its simplicity and flexibility.
“The top rate from ICICI Bank only launched in the last few days, so I would imagine more providers adjusting their rates and leapfrog to the top, we just don’t know when that might be.
“As we have seen before, a great deal doesn’t last very long – the last time we had an easy access deal paying 1.55 per cent was when Nottingham Building Society had its eSaver priced at 1.55 per cent.
“Otherwise, month-on-month this [1.55 per cent rate] is the highest easy access rate seen since March 2016.”
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Savers looking to earn some extra cash on their savings should trust their money with banks that they’ve probably never heard of, experts say.
Meanwhile, an investigation by The Sun has found that some customers are being offered rates of just 0.05 per cent on their easy access accounts, amounting to just £5 in interest on savings worth £10,000 over a year.
If overhauling your finances is your New Year’s resolution for 2019, we’ve rounded up the best budgeting apps to help you manage your money.
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