Notice accounts flourish for short-term savers

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Rachel Springall, Press Officer
Rachel Springall, Press Officer / Finance Expert T: 01603 476210 E: Email Rachel
04/10/2021

Notice accounts flourish for short-term savers

Savers may be pleased to find competition has flourished among notice accounts which are now offering the best returns on average since the start of 2021, according to the latest analysis by Moneyfacts.co.uk - the consumer comparison site.

  • The average notice account rate has risen to its highest point during 2021, now 0.54%, up from 0.37% six months ago. Average rates have improved significantly since the record low recorded in May 2021 of 0.36%.
  • The top notice account rate of 1.10% today pays more than double than one of the top six best rates available in April 2021 of 0.52%.
  • These improvements come at a time when short-term fixed bonds experience a notable rise in competition, with the average one-year fixed bond rate rising from 0.43% in April 2021 to 0.79% today and the average 18-month bond rate rising from 0.58% to 1.10%.
  • Challenger banks offer the best notice account rates and, compared to April 2021, many of the top six rates today require 120 days’ notice. Savers may be keen to explore notice accounts if they are not comfortable with locking their money into a fixed rate bond.

Notice accounts flourish for short-term savers

Savers may be pleased to find competition has flourished among notice accounts which are now offering the best returns on average since the start of 2021, according to the latest analysis by Moneyfacts.co.uk - the consumer comparison site.

  • The average notice account rate has risen to its highest point during 2021, now 0.54%, up from 0.37% six months ago. Average rates have improved significantly since the record low recorded in May 2021 of 0.36%.
  • The top notice account rate of 1.10% today pays more than double than one of the top six best rates available in April 2021 of 0.52%.
  • These improvements come at a time when short-term fixed bonds experience a notable rise in competition, with the average one-year fixed bond rate rising from 0.43% in April 2021 to 0.79% today and the average 18-month bond rate rising from 0.58% to 1.10%.
  • Challenger banks offer the best notice account rates and, compared to April 2021, many of the top six rates today require 120 days’ notice. Savers may be keen to explore notice accounts if they are not comfortable with locking their money into a fixed rate bond.

Rates at £10,000 gross

Oct-19

Oct-20

Apr-21

Sep-21

Oct-21

Notice account rate

1.11%

0.54%

0.37%

0.47%

0.54%

One-year fixed bond rate

1,31%

0.70%

0.43%

0.69%

0.79%

18-month fixed bond rate

1.44%

0.83%

0.58%

0.92%

1.10%

Source: Moneyfacts.co.uk

 

Top notice accounts - October 2021

Provider and term

Gross rate at £10,000

Recognise Bank (95 Day)

1.10%

Secure Trust Bank (90 Day)

1.07%

OakNorth Bank (120 Day)

1.06%

Oxbury Bank (120 Day)

1.06%

DF Capital (120 Day)

1.05%

Charter Savings Bank (120 Day)

1.05%

Source: Moneyfacts.co.uk

 

Top notice accounts - April 2021

Provider and term

Gross rate at £10,000

Moneycorp Bank (90 Day)

0.65%

Moneybox (95 Day)

0.60%

OakNorth Bank (120 Day)

0.58%

OakNorth Bank (90 Day)

0.56%

ICICI Bank UK (95 Day)

0.55%

Oxbury Bank (95 Day)

0.52%

Source: Moneyfacts.co.uk

Rates at £10,000 gross

Oct-19

Oct-20

Apr-21

Sep-21

Oct-21

Notice account rate

1.11%

0.54%

0.37%

0.47%

0.54%

One-year fixed bond rate

1,31%

0.70%

0.43%

0.69%

0.79%

18-month fixed bond rate

1.44%

0.83%

0.58%

0.92%

1.10%

Source: Moneyfacts.co.uk

 

Top notice accounts - October 2021

Provider and term

Gross rate at £10,000

Recognise Bank (95 Day)

1.10%

Secure Trust Bank (90 Day)

1.07%

OakNorth Bank (120 Day)

1.06%

Oxbury Bank (120 Day)

1.06%

DF Capital (120 Day)

1.05%

Charter Savings Bank (120 Day)

1.05%

Source: Moneyfacts.co.uk

 

Top notice accounts - April 2021

Provider and term

Gross rate at £10,000

Moneycorp Bank (90 Day)

0.65%

Moneybox (95 Day)

0.60%

OakNorth Bank (120 Day)

0.58%

OakNorth Bank (90 Day)

0.56%

ICICI Bank UK (95 Day)

0.55%

Oxbury Bank (95 Day)

0.52%

Source: Moneyfacts.co.uk

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

“Notice accounts are flourishing as savings providers have significantly improved rates and expanded choice. There are now more notice account options available, the highest count since December 2020. Savers looking for a decent return on their cash may have noticed a rise in short-term fixed bond rates recently, but a notice account may be a more suitable alternative for those who are not comfortable with locking their cash away for too long.

“Six months ago, the average notice account rate was 0.37% and in May 2021 it fell to a record low of 0.36%, but this has since risen to 0.54% thanks to significant improvement in competition. In April 2021 the top notice account paid 0.65% and in fact one of the top six deals paid 0.52%, so today’s market-leading rate of 1.10% pays more than double the amount of interest. Unlike fixed bonds, notice accounts pay a variable rate, but the ability to give notice to access funds may be more favourable to some savers and the maximum notice term today is about four months.

“Consumers comparing different savings accounts may also appreciate that most notice accounts will allow them to deposit funds little and often, unlike fixed bonds which typically require an upfront lump sum at the point of application. There are many notice accounts that pay better variable rates than easy access accounts too if savers are happy to give notice to access their cash. As the market continues to improve, it would be wise for consumers to keep a close eye on the top rate tables and be quick to apply so that they are not left disappointed.”

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

“Notice accounts are flourishing as savings providers have significantly improved rates and expanded choice. There are now more notice account options available, the highest count since December 2020. Savers looking for a decent return on their cash may have noticed a rise in short-term fixed bond rates recently, but a notice account may be a more suitable alternative for those who are not comfortable with locking their cash away for too long.

“Six months ago, the average notice account rate was 0.37% and in May 2021 it fell to a record low of 0.36%, but this has since risen to 0.54% thanks to significant improvement in competition. In April 2021 the top notice account paid 0.65% and in fact one of the top six deals paid 0.52%, so today’s market-leading rate of 1.10% pays more than double the amount of interest. Unlike fixed bonds, notice accounts pay a variable rate, but the ability to give notice to access funds may be more favourable to some savers and the maximum notice term today is about four months.

“Consumers comparing different savings accounts may also appreciate that most notice accounts will allow them to deposit funds little and often, unlike fixed bonds which typically require an upfront lump sum at the point of application. There are many notice accounts that pay better variable rates than easy access accounts too if savers are happy to give notice to access their cash. As the market continues to improve, it would be wise for consumers to keep a close eye on the top rate tables and be quick to apply so that they are not left disappointed.”

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, there is no commercial influence on the way Moneyfacts.co.uk ranks products, 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.

 

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, there is no commercial influence on the way Moneyfacts.co.uk ranks products, 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.

 

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