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Inflation must not discourage savers from switching deals

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Rachel Springall, Press Officer
Rachel Springall, Press Officer / Finance Expert 01603 476210 Email Rachel
21/06/2023

Inflation must not discourage savers from switching deals

Substantial rate rises have been seen across the savings market over the past few weeks, but inflation continues to eat into real returns. Moneyfactscompare.co.uk reveals the top rate deals available to savers searching for a competitive return.

Inflation must not discourage savers from switching deals

Substantial rate rises have been seen across the savings market over the past few weeks, but inflation continues to eat into real returns. Moneyfactscompare.co.uk reveals the top rate deals available to savers searching for a competitive return.

  • The Consumer Price Index (CPI) remained at 8.7% during May, from 8.7% in April.
  • The number of deals able to outpace inflation has not changed since last month. There is not one standard savings account that can outpace 8.7%*.
  • The predicted rate for inflation during Q2 2024 is 3.4%.
  • In June 2022, there were no deals that could beat 9.1% (May 2022 CPI) and in June 2021, there were no deals that could beat 2.1% (May 2021 CPI).

 

  • The Consumer Price Index (CPI) remained at 8.7% during May, from 8.7% in April.
  • The number of deals able to outpace inflation has not changed since last month. There is not one standard savings account that can outpace 8.7%*.
  • The predicted rate for inflation during Q2 2024 is 3.4%.
  • In June 2022, there were no deals that could beat 9.1% (May 2022 CPI) and in June 2021, there were no deals that could beat 2.1% (May 2021 CPI).

 

Savings market analysis

Top savings deals at £10,000 gross

16-Jun-21

22-Jun-22

24-May-23

Today

Easy access account

Atom Bank – 0.50%

Virgin Money – 1.55%

Hanley Economic BS – 4.25%

Principality BS – 4.01%

Notice account

Shawbrook Bank – 0.72% (120-day)

Oxbury Bank – 1.95% (180-day)

FirstSave – 4.25% (90-day)

RCI Bank UK – 4.85% (95-day)

One-year fixed rate bond

Gatehouse Bank – 0.91%**

Atom Bank – 2.60%

SmartSave – 5.00%

Ahli United Bank (UK) plc – 5.70%

Two-year fixed rate bond

UBL UK – 1.12% (payable on maturity)

BLME – 3.00%

Investec Bank plc (Raisin UK) – 5.07%

Investec Bank plc (Raisin UK) – 5.60%

Three-year fixed rate bond

Cynergy Bank – 1.25%

BLME – 3.05%

Isbank (Raisin UK) – 4.95%

Investec Bank plc (Raisin UK) – 6.00%

Four-year fixed rate bond

Zopa – 1.19%

BLME – 3.10%

Isbank (Raisin UK) – 4.95%

RCI Bank UK – 5.55%

Five-year fixed rate bond

UBL UK – 1.60% (payable on maturity)

BLME – 3.25%

Tandem Bank – 5.00%

RCI Bank UK – 5.55%

**Islamic bank, pays an expected profit rate. Inflation announcement dates.

Source: Moneyfactscompare.co.uk

 

ISA market analysis

Top savings deals at £10,000 gross

16-Jun-21

22-Jun-22

24-May-23

Today

Easy access ISA

Cynergy Bank – 0.54%

Paragon Bank – 1.35%

Yorkshire Building Society – 3.60%

Shawbrook Bank – 3.78%

Notice ISA

Aldermore – 0.35% (30-day)

Aldermore – 1.40% (30-day)

Marsden BS – 4.00% (180-day)

Teachers BS – 4.00% (120-day)

One-year fixed rate ISA

Shawbrook Bank – 0.56%

Virgin Money – 2.06%

Paragon Bank – 4.40%

Virgin Money – 4.75%

Two-year fixed rate ISA

UBL UK – 0.81% (payable on maturity)

Virgin Money – 2.36%

NatWest – 4.50%

Virgin Money – 4.91%

Three-year fixed rate ISA

UBL UK – 0.97% (payable on maturity)

Leeds BS – 2.75%

Virgin Money – 4.41%

Virgin Money – 5.00%

Four-year fixed rate ISA

Hodge Bank – 0.65%

UBL UK – 2.44% (payable on maturity)

Gatehouse Bank – 4.20%**

United Trust Bank – 4.85%

Five-year fixed rate ISA

UBL UK – 1.24% (payable on maturity)

UBL UK – 2.74% (payable on maturity)

Gatehouse Bank – 4.20%**

United Trust Bank – 4.90%

**Islamic bank, pays an expected profit rate. Inflation announcement dates.

Source: Moneyfactscompare.co.uk

 

Savings market analysis

Top savings deals at £10,000 gross

16-Jun-21

22-Jun-22

24-May-23

Today

Easy access account

Atom Bank – 0.50%

Virgin Money – 1.55%

Hanley Economic BS – 4.25%

Principality BS – 4.01%

Notice account

Shawbrook Bank – 0.72% (120-day)

Oxbury Bank – 1.95% (180-day)

FirstSave – 4.25% (90-day)

RCI Bank UK – 4.85% (95-day)

One-year fixed rate bond

Gatehouse Bank – 0.91%**

Atom Bank – 2.60%

SmartSave – 5.00%

Ahli United Bank (UK) plc – 5.70%

Two-year fixed rate bond

UBL UK – 1.12% (payable on maturity)

BLME – 3.00%

Investec Bank plc (Raisin UK) – 5.07%

Investec Bank plc (Raisin UK) – 5.60%

Three-year fixed rate bond

Cynergy Bank – 1.25%

BLME – 3.05%

Isbank (Raisin UK) – 4.95%

Investec Bank plc (Raisin UK) – 6.00%

Four-year fixed rate bond

Zopa – 1.19%

BLME – 3.10%

Isbank (Raisin UK) – 4.95%

RCI Bank UK – 5.55%

Five-year fixed rate bond

UBL UK – 1.60% (payable on maturity)

BLME – 3.25%

Tandem Bank – 5.00%

RCI Bank UK – 5.55%

**Islamic bank, pays an expected profit rate. Inflation announcement dates.

Source: Moneyfactscompare.co.uk

 

ISA market analysis

Top savings deals at £10,000 gross

16-Jun-21

22-Jun-22

24-May-23

Today

Easy access ISA

Cynergy Bank – 0.54%

Paragon Bank – 1.35%

Yorkshire Building Society – 3.60%

Shawbrook Bank – 3.78%

Notice ISA

Aldermore – 0.35% (30-day)

Aldermore – 1.40% (30-day)

Marsden BS – 4.00% (180-day)

Teachers BS – 4.00% (120-day)

One-year fixed rate ISA

Shawbrook Bank – 0.56%

Virgin Money – 2.06%

Paragon Bank – 4.40%

Virgin Money – 4.75%

Two-year fixed rate ISA

UBL UK – 0.81% (payable on maturity)

Virgin Money – 2.36%

NatWest – 4.50%

Virgin Money – 4.91%

Three-year fixed rate ISA

UBL UK – 0.97% (payable on maturity)

Leeds BS – 2.75%

Virgin Money – 4.41%

Virgin Money – 5.00%

Four-year fixed rate ISA

Hodge Bank – 0.65%

UBL UK – 2.44% (payable on maturity)

Gatehouse Bank – 4.20%**

United Trust Bank – 4.85%

Five-year fixed rate ISA

UBL UK – 1.24% (payable on maturity)

UBL UK – 2.74% (payable on maturity)

Gatehouse Bank – 4.20%**

United Trust Bank – 4.90%

**Islamic bank, pays an expected profit rate. Inflation announcement dates.

Source: Moneyfactscompare.co.uk

 

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

“Savers will find much better rates to choose from compared to a few weeks ago, but such high inflation continues to erode the true spending power of savers' cash. However, high inflation must not discourage savers from reviewing their accounts and switching, as they could find a much better return now, particularly if they have a maturing fixed rate bond. It is true that over two years have now passed since any standard savings accounts could beat inflation, but it is worth remembering that in 2021 we also saw average savings rates fall to record lows. Despite high inflation, it’s imperative savers make every effort to secure a better deal and act with pace to take advantage of a top rate.

“Easy access savings accounts have continued to flourish this month, with many challenger banks and building societies improving their offers, as we witness both competition and influences from the Bank of England base rate rises. Savers can now secure a top easy access rate of around 4% gross, which is more than double the top return on offer a year ago. However, it’s vital consumers carefully check the terms and conditions of these accounts, as some can restrict withdrawals. There has also been heated competition across fixed rate bonds, with notable rises to one-year fixed deals. Savers will find the top one-year fixed bond pays more than double the equivalent top deal this time a year ago. Challenger banks currently offer some of the top returns, and the market remains a fast-paced environment, with some raising rates more than once in a week. Deals offered by a challenger bank can change quickly when they meet their funding targets, so there is no guarantee a top rate will be around for long.

“Some savers may only be prepared to invest their cash over the shorter-term or even in a flexible account, but there are still notice accounts and longer-term fixed bonds, as well as their ISA equivalents, to consider too. It is expected more base rate rises are imminent, so it’s worthwhile for savers to prepare themselves and keep abreast of the latest deals to hit the market.”

*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.

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

“Savers will find much better rates to choose from compared to a few weeks ago, but such high inflation continues to erode the true spending power of savers' cash. However, high inflation must not discourage savers from reviewing their accounts and switching, as they could find a much better return now, particularly if they have a maturing fixed rate bond. It is true that over two years have now passed since any standard savings accounts could beat inflation, but it is worth remembering that in 2021 we also saw average savings rates fall to record lows. Despite high inflation, it’s imperative savers make every effort to secure a better deal and act with pace to take advantage of a top rate.

“Easy access savings accounts have continued to flourish this month, with many challenger banks and building societies improving their offers, as we witness both competition and influences from the Bank of England base rate rises. Savers can now secure a top easy access rate of around 4% gross, which is more than double the top return on offer a year ago. However, it’s vital consumers carefully check the terms and conditions of these accounts, as some can restrict withdrawals. There has also been heated competition across fixed rate bonds, with notable rises to one-year fixed deals. Savers will find the top one-year fixed bond pays more than double the equivalent top deal this time a year ago. Challenger banks currently offer some of the top returns, and the market remains a fast-paced environment, with some raising rates more than once in a week. Deals offered by a challenger bank can change quickly when they meet their funding targets, so there is no guarantee a top rate will be around for long.

“Some savers may only be prepared to invest their cash over the shorter-term or even in a flexible account, but there are still notice accounts and longer-term fixed bonds, as well as their ISA equivalents, to consider too. It is expected more base rate rises are imminent, so it’s worthwhile for savers to prepare themselves and keep abreast of the latest deals to hit the market.”

*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 35 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.

Moneyfactscompare.co.uk is the financial product price comparison site, launched as Moneyfacts.co.uk in 2000 and rebranded to Moneyfactscompare.co.uk in 2023, which helps consumers compare thousands of financial products, including credit cards, savings, mortgages and many more. Unlike other comparison sites, Moneyfactscompare.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 Moneyfactscompare.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 35 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.

Moneyfactscompare.co.uk is the financial product price comparison site, launched as Moneyfacts.co.uk in 2000 and rebranded to Moneyfactscompare.co.uk in 2023, which helps consumers compare thousands of financial products, including credit cards, savings, mortgages and many more. Unlike other comparison sites, Moneyfactscompare.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 Moneyfactscompare.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.

 

Contact Us If you're looking for extra comment, a chart or more information, then please give us a call. We are always more than happy to help.
Rachel Springall Press Officer / Finance Expert
Caitlyn Eastell Apprentice Press & PR Assistant