Competition among savings providers is intensifying in the current market, with multiple institutions raising their interest rate offerings. The number of accounts paying above the Bank of England base rate of 3.75% has reached its highest level in more than six years, with 1,385 such accounts now available, representing more than half of all savings products tracked by financial data providers.
For customers seeking immediate access to funds, easy-access savings accounts are becoming increasingly attractive. The average rate for non-Isa easy-access accounts stands at 2.53%, the highest point in nearly a year. Several providers are offering significantly higher rates on these accounts. Revolut, operating as a fully licensed bank, is offering new UK customers 5% on instant-access savings accounts opened by 4 August, applicable to balances up to £25,000, with the rate reverting to 2.9% afterward. Chase provides a 4.5% rate on its Chase Saver easy-access account for new customers, which includes a 2.25% bonus lasting 12 months.
Fixed-rate savings bonds continue to deliver competitive returns, with one-year bonds proving particularly popular among savers hesitant to commit funds for extended periods. The average one-year fixed-rate bond has risen to 4.22%, its highest level since November 2024. Individual providers are offering higher rates, including Marcus by Goldman Sachs at 4.9% and Atom Bank at 4.8% on one-year fixed bonds.
Regular savings accounts are generating notable interest, with rates reaching 8%. Lloyds launched an instant-access regular savings account called Monthly Saver this month offering this rate, while similar products from Santander match this figure. These accounts typically require monthly deposits between £25 and £250, with interest paid after 12 months.
Prospective savers should note tax implications on interest earned outside Individual Savings Accounts. Personal savings allowances are £1,000 for basic-rate taxpayers, £500 for higher-rate taxpayers, and up to £5,000 for those earning below £17,570 annually.
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