Four savings providers have announced they are raising easy access savings rates following the Bank of England’s base rate hike.
Monzo, Atom Bank, Chase and Yorkshire Building Society are all raising rates in response to the Bank of England adding 0.25 per cent to the base rate to bring it to 4.25 per cent.
Deposits held with all four providers are protected by the Financial Services Compensation Scheme (FSCS) up to a value of £85,000 per person.
Rise in base rates: Easily accessible savings rates are expected to improve following the Bank of England’s vote to raise base rates from 4% to 4.25%.
The Yorkshire Building Society was the first to announce that it would automatically add 0.25 per cent to its floating rate savings accounts from 5 April.
The increase is the eighth time since February last year that the mutual has passed increases to depositors and will see the minimum interest paid on direct access accounts rise to 2.8 percent and those with limited access to a minimum of 3 percent.
YBS goes to 3.6%… and for some 4.25%
in particular Yorkshire BS’s Rainy Day Accountspaying 3.35 per cent on credits up to £5,000 will rise to 3.6 per cent next month.
For cash above £5,000, the rate will increase from 2.85 per cent to 3.1 per cent. The account limits savers to two withdrawals per year.
It is easily accessible Internet Saver Plus account will now pay between 3 percent and 3.15 percent, depending on how much is in the account.
His Limited Access cash Isa will rise from 3.1 to 3.35 percent while his Loyalty Six Access Saver Isaavailable to members who either save or have a mortgage with the mutual, will rise from 4 per cent to 4.25 per cent on balances up to £20,000.
Onwards and upwards: It is the 11th consecutive Bank of England rate hike in 14 months and the highest since October 2008, in the wake of the financial crisis.
Chris Irwin, director of savings at Yorkshire Building Society, said: ‘Our decision today to pass on the full rise in the Bank’s base rate to our accounts continues to reflect our mutual ethos of putting our members first .
“Rising rates across our range, including most of our loyalty savings accounts, continue to reflect our goal to support savers.”
Big player: Founded in 2015, Monzo claims to be the UK’s largest digital bank with over 7 million customers, adding 150,000 each month.
Monzo goes to 3.2%
Meanwhile, digital bank Monzo, which only last month announced the launch of its first-ever instant access savings account and paid 3 percent, immediately raises the rate to 3.2 percent.
As of today, banking clients will benefit from Monzo and can save up to a maximum of £100,000.
Someone who deposits £10,000 into Monzo’s instant access account can expect to receive £320 in interest after a year – if the rate remains unchanged.
Atom goes to 3.2%
Atom Bank, also commented on the announcement. It will increase from tonight Direct savings from 2.95 percent to 3.2 percent.
The rate increase is automatically passed on to all existing and new customers.
Atom allows for unlimited withdrawals and savers can deposit up to £100,000 into the account.
Aileen Robertson, Head of Savings at Atom Bank said: ‘With inflation rising again yesterday, savers need to take stock and cash in the best deal to ensure their money is working as hard as possible.
The best accounts at a glance
None beat inflation this month, but be sure to shop around for the best returns possible.
Easy access: chip – 3.4%
One-year fixed rate: Al Rayan Bank – 4.5%
Two-year fixed rate: Al Rayan Bank – 4.62%
5 year fixed rate: Tandem bench – 4.6%
Easily accessible cash Isa: Santander – 3.2%
“We can see from the latest results from the big five banks that only £5bn of their £12bn interest earnings flowed back to savers, further evidence that rate hikes have been used as an opportunity to boost profits.
With the base rate now at 4.25 percent, some banks still pay as little as 0.55 percent into easily accessible accounts, a meager return for those who want and need access to their savings.
“However, following today’s announcement from the Bank of England, we will raise our Instant Saver rate again as part of our mission to offer UK savers better value for their money.”
Pursuit goes to 3.1%
Chase, backed by JP Morgan, is also raising interest on his popular linked savings account, albeit only from 3 percent to 3.1 percent.
The rate change will take effect on April 3. The rate increase is automatically passed on to all existing and new customers.
Savers can deposit up to £500,000 into the linked savings account, although they must be a Chase Banking customer to take advantage of this.
Shaun Port, general manager of day-to-day banking at Chase, said, “We want to help savers make their money work harder while providing a simple and uncomplicated way to save.
“By increasing the rate on our linked savings account, customers can manage and use their savings in a way that suits them and supports them in achieving their savings goals.”
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