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Impossible task for savers as inflation rises once more

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Rachel Springall, Press Officer
Rachel Springall, Press Officer / Finance Expert T: 01603 476210 E: Email Rachel
23/03/2022

Impossible task for savers as inflation rises once more

Inflation has continued to rise, making it an impossible task for cash savers to protect their cash from its eroding impact. Acquiring the best savings deal is crucial to soften its eroding impact and the latest analysis from Moneyfacts.co.uk reveals the top rate deals available to savers searching for a competitive return.

Impossible task for savers as inflation rises once more

Inflation has continued to rise, making it an impossible task for cash savers to protect their cash from its eroding impact. Acquiring the best savings deal is crucial to soften its eroding impact and the latest analysis from Moneyfacts.co.uk reveals the top rate deals available to savers searching for a competitive return.

  • The Consumer Price Index (CPI) rose to 6.2% during February, from 5.5% in January.
  • The number of deals able to outpace inflation has not changed since last month. There is not one standard savings account that can outpace 6.2%*.
  • The predicted rate for inflation during Q1 2023 is 5.2%.
  • In March 2021, 326 deals (seven easy access accounts, 23 notice accounts, eight variable rate ISAs, 78 fixed rate ISAs and 210 fixed rate bonds) could beat 0.4% (February 2021 CPI) and in March 2020, 26 deals (all fixed rate bonds) could beat 1.7% (February 2020 CPI)*.

 

Savings market analysis

Top savings deals at £10,000 gross

25-Mar-20

24-Mar-21

16-Feb-22

Today

Easy access account

Cynergy Bank – 1.31%

Virgin Money – 0.50%

Cynergy Bank – 0.71%

Virgin Money – 1.00%***

Notice account

ICICI Bank UK – 1.59% (95-day)

Charter Savings Bank – 0.65% (120-day)

Shawbrook Bank – 1.08% (120-day)

Shawbrook Bank – 1.15% (120-day)

One-year fixed rate bond

OakNorth Bank – 1.57%

Ahli United Bank (UK) plc (Through Raisin UK) – 0.65%

Tandem Bank – 1.45%

Al Rayan Bank – 1.70%**

Two-year fixed rate bond

Wesleyan Bank – 1.67%

QIB (UK) (Through Raisin UK) – 0.80%**

Al Rayan Bank – 1.66%**

JN Bank – 1.96%

Three-year fixed rate bond

United Trust Bank – 1.80%

BLME – 1.00%**

UBL UK – 1.88% (payable on maturity)

JN Bank – 2.11%

Four-year fixed rate bond

RCI Bank UK – 1.80%

BLME – 1.05%**

JN Bank – 1.95%

PCF Bank – 2.15%

Five-year fixed rate bond

Gatehouse Bank – 2.00%**

Hodge Bank – 1.30%

UBL UK – 2.19% (payable on maturity)

PCF Bank – 2.30%

**Islamic bank, pays an expected profit rate. ***Available to new and existing Virgin Money M Plus Account customers. Inflation announcement dates. Source: Moneyfacts.co.uk

  • The Consumer Price Index (CPI) rose to 6.2% during February, from 5.5% in January.
  • The number of deals able to outpace inflation has not changed since last month. There is not one standard savings account that can outpace 6.2%*.
  • The predicted rate for inflation during Q1 2023 is 5.2%.
  • In March 2021, 326 deals (seven easy access accounts, 23 notice accounts, eight variable rate ISAs, 78 fixed rate ISAs and 210 fixed rate bonds) could beat 0.4% (February 2021 CPI) and in March 2020, 26 deals (all fixed rate bonds) could beat 1.7% (February 2020 CPI)*.

 

Savings market analysis

Top savings deals at £10,000 gross

25-Mar-20

24-Mar-21

16-Feb-22

Today

Easy access account

Cynergy Bank – 1.31%

Virgin Money – 0.50%

Cynergy Bank – 0.71%

Virgin Money – 1.00%***

Notice account

ICICI Bank UK – 1.59% (95-day)

Charter Savings Bank – 0.65% (120-day)

Shawbrook Bank – 1.08% (120-day)

Shawbrook Bank – 1.15% (120-day)

One-year fixed rate bond

OakNorth Bank – 1.57%

Ahli United Bank (UK) plc (Through Raisin UK) – 0.65%

Tandem Bank – 1.45%

Al Rayan Bank – 1.70%**

Two-year fixed rate bond

Wesleyan Bank – 1.67%

QIB (UK) (Through Raisin UK) – 0.80%**

Al Rayan Bank – 1.66%**

JN Bank – 1.96%

Three-year fixed rate bond

United Trust Bank – 1.80%

BLME – 1.00%**

UBL UK – 1.88% (payable on maturity)

JN Bank – 2.11%

Four-year fixed rate bond

RCI Bank UK – 1.80%

BLME – 1.05%**

JN Bank – 1.95%

PCF Bank – 2.15%

Five-year fixed rate bond

Gatehouse Bank – 2.00%**

Hodge Bank – 1.30%

UBL UK – 2.19% (payable on maturity)

PCF Bank – 2.30%

**Islamic bank, pays an expected profit rate. ***Available to new and existing Virgin Money M Plus Account customers. Inflation announcement dates. Source: Moneyfacts.co.uk

ISA market analysis

Top savings deals at £10,000 gross

25-Mar-20

24-Mar-21

16-Feb-22

Today

Easy access ISA

Al Rayan Bank – 1.35%**

Al Rayan Bank – 0.60%**

Paragon Bank – 0.65%

Paragon Bank – 0.80%

Notice ISA

Paragon Bank – 1.31% (120-day)

Marsden BS – 0.55% (95-day)

Aldermore – 0.55% (30-day)

Buckinghamshire BS – 0.60% (30-day)

One-year fixed rate ISA

Virgin Money – 1.36%

Charter Savings Bank – 0.50%

Coventry BS – 1.05%

OakNorth Bank – 1.28%

Two-year fixed rate ISA

Al Rayan Bank – 1.50%**

State Bank of India – 0.65%

UBL UK – 1.37% (payable on maturity)

UBL UK – 1.61% (payable on maturity)

Three-year fixed rate ISA

Marsden BS – 1.55%

Charter Savings Bank – 0.75%

Coventry BS – 1.45%

UBL UK – 1.73% (payable on maturity)

Four-year fixed rate ISA

Hodge Bank – 1.55%

Hodge Bank – 0.65%

UBL UK – 1.54% (payable on maturity)

UBL UK – 1.74% (payable on maturity)

Five-year fixed rate ISA

Paragon Bank – 1.60%

Shawbrook Bank – 1.10%

UBL UK – 1.82% (payable on maturity)

UBL UK – 1.93% (payable on maturity)

**Islamic bank, pays an expected profit rate. Inflation announcement dates. Source: Moneyfacts.co.uk

 

Rachel Springall, Finance Expert at Moneyfacts.co.uk, said:

“Inflation stood at 0.4% a year ago and the number of savings accounts which could outpace its eroding impact were plentiful. However, the top deals today can either match or beat the market-leading deals seen this time a year ago, which is a positive direction for the savings market, but sadly rising inflation is taking its toll and not one standard savings account can beat it today. The Bank of England predicts inflation will be beyond the 2% target for some time yet, but even if inflation fell to 2%, there are few options for savers to choose from to outpace this rate.

“The base rate rises we have seen since December 2021 can have a positive impact on the savings market, but not every saver will have benefited from this movement. At present it is the challenger banks and building societies who are competing in the cash savings sector, with notable improvements to the easy access sector in recent weeks. However, as the biggest high-street banks fail to pass on the full rises to their customers, and some pay as low as 0.01% in interest, it would be sensible for savers to ditch and switch.

“Beyond expectations savers will have noticed a much-desired ISA season start to blossom, so if they have yet to utilise their ISA allowance, now is a good time to compare deals with just two weeks to go until the new tax year. However, savers will notice a rate difference between fixed bonds and ISAs, so they need to be conscious of any Personal Savings Allowance (PSA) they have as well as their ISA allowance. Easy access ISAs are seeing a spate of improvement, but not every top rate will accept transfers in and not every account will permit unlimited withdrawals, so this may not suit every saver looking for flexibility. As the top rate deals remain volatile, it would be a good idea for savers to take some pressure off themselves by signing up to rate alerts and newsletters to keep them in the know.”

*Data note: Please note that these savings product numbers only include deals that are available to UK residents (easy access, notice, fixed rate bonds, variable or fixed ISAs) and exclude regular savers and children’s savers (this figure does not count each interest payment option for each account), based on a £10,000 deposit. Higher rates may be available for other levels of deposit.

ISA market analysis

Top savings deals at £10,000 gross

25-Mar-20

24-Mar-21

16-Feb-22

Today

Easy access ISA

Al Rayan Bank – 1.35%**

Al Rayan Bank – 0.60%**

Paragon Bank – 0.65%

Paragon Bank – 0.80%

Notice ISA

Paragon Bank – 1.31% (120-day)

Marsden BS – 0.55% (95-day)

Aldermore – 0.55% (30-day)

Buckinghamshire BS – 0.60% (30-day)

One-year fixed rate ISA

Virgin Money – 1.36%

Charter Savings Bank – 0.50%

Coventry BS – 1.05%

OakNorth Bank – 1.28%

Two-year fixed rate ISA

Al Rayan Bank – 1.50%**

State Bank of India – 0.65%

UBL UK – 1.37% (payable on maturity)

UBL UK – 1.61% (payable on maturity)

Three-year fixed rate ISA

Marsden BS – 1.55%

Charter Savings Bank – 0.75%

Coventry BS – 1.45%

UBL UK – 1.73% (payable on maturity)

Four-year fixed rate ISA

Hodge Bank – 1.55%

Hodge Bank – 0.65%

UBL UK – 1.54% (payable on maturity)

UBL UK – 1.74% (payable on maturity)

Five-year fixed rate ISA

Paragon Bank – 1.60%

Shawbrook Bank – 1.10%

UBL UK – 1.82% (payable on maturity)

UBL UK – 1.93% (payable on maturity)

**Islamic bank, pays an expected profit rate. Inflation announcement dates. Source: Moneyfacts.co.uk

 

Rachel Springall, Finance Expert at Moneyfacts.co.uk, said:

“Inflation stood at 0.4% a year ago and the number of savings accounts which could outpace its eroding impact were plentiful. However, the top deals today can either match or beat the market-leading deals seen this time a year ago, which is a positive direction for the savings market, but sadly rising inflation is taking its toll and not one standard savings account can beat it today. The Bank of England predicts inflation will be beyond the 2% target for some time yet, but even if inflation fell to 2%, there are few options for savers to choose from to outpace this rate.

“The base rate rises we have seen since December 2021 can have a positive impact on the savings market, but not every saver will have benefited from this movement. At present it is the challenger banks and building societies who are competing in the cash savings sector, with notable improvements to the easy access sector in recent weeks. However, as the biggest high-street banks fail to pass on the full rises to their customers, and some pay as low as 0.01% in interest, it would be sensible for savers to ditch and switch.

“Beyond expectations savers will have noticed a much-desired ISA season start to blossom, so if they have yet to utilise their ISA allowance, now is a good time to compare deals with just two weeks to go until the new tax year. However, savers will notice a rate difference between fixed bonds and ISAs, so they need to be conscious of any Personal Savings Allowance (PSA) they have as well as their ISA allowance. Easy access ISAs are seeing a spate of improvement, but not every top rate will accept transfers in and not every account will permit unlimited withdrawals, so this may not suit every saver looking for flexibility. As the top rate deals remain volatile, it would be a good idea for savers to take some pressure off themselves by signing up to rate alerts and newsletters to keep them in the know.”

*Data note: Please note that these savings product numbers only include deals that are available to UK residents (easy access, notice, fixed rate bonds, variable or fixed ISAs) and exclude regular savers and children’s savers (this figure does not count each interest payment option for each account), based on a £10,000 deposit. Higher rates may be available for other levels of deposit.

Notes to editors

Pioneering financial comparison technology for over 30 years.

Moneyfacts Group plc is the UK’s leading provider of retail financial product data. Used by virtually every bank and building society in the UK, and supplied to the Bank of England, Financial Conduct Authority, Financial Ombudsman Service, HM Treasury, Prudential Regulatory Authority and UK Finance.

Our expert research team monitors the thousands of mortgages, savings, credit card, personal loan, business banking, life, pension and investment products in the UK.

Moneyfacts.co.uk is a financial product price comparison site, launched in 2000, which helps consumers compare thousands of financial products, including credit cards, savings, mortgages and many more. Unlike other comparison sites, Moneyfacts.co.uk shows whole of market data regardless of commercial bias, showing consumers a true picture of the best products based on the criteria they select.

We hope you find this press release insightful. We would appreciate a link back to Moneyfacts.co.uk if you decide to source this information.

For more information about us please see our key facts.

Broadcast

Our broadcast suite enables our finance experts to appear in-vision for television, and we regularly comment live on national and regional radio.

To arrange an interview for radio or television, please contact our press department. We have an in-house broadcast room.

 

Notes to editors

Pioneering financial comparison technology for over 30 years.

Moneyfacts Group plc is the UK’s leading provider of retail financial product data. Used by virtually every bank and building society in the UK, and supplied to the Bank of England, Financial Conduct Authority, Financial Ombudsman Service, HM Treasury, Prudential Regulatory Authority and UK Finance.

Our expert research team monitors the thousands of mortgages, savings, credit card, personal loan, business banking, life, pension and investment products in the UK.

Moneyfacts.co.uk is a financial product price comparison site, launched in 2000, which helps consumers compare thousands of financial products, including credit cards, savings, mortgages and many more. Unlike other comparison sites, Moneyfacts.co.uk shows whole of market data regardless of commercial bias, showing consumers a true picture of the best products based on the criteria they select.

We hope you find this press release insightful. We would appreciate a link back to Moneyfacts.co.uk if you decide to source this information.

For more information about us please see our key facts.

Broadcast

Our broadcast suite enables our finance experts to appear in-vision for television, and we regularly comment live on national and regional radio.

To arrange an interview for radio or television, please contact our press department. We have an in-house broadcast room.

 

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Rachel Springall Press Officer / Finance Expert
Eleanor Williams Press Officer / Finance Expert