Last chance to get 5.78% off this 365-day savings deal that’s better than the one-year fixes

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Savers can still take advantage of the best one-year fixed-rate period with a 365-day savings account yielding 5.78 percent if they sign up this week.

The 365-day notice period account is offered by the savings and investment platform Bloom*, in a deal This is Money has secured for readers through Friday, July 27.

The Prosper account pays a variable rate of interest that is 0.35 per cent above the Bank of England base rate, giving a current gross rate of 5.6 per cent. But because the interest is calculated and compounded daily, the AER is even higher – at 5.78 per cent.

This is significantly better than the best one-year fixed rates of Union Bank of India (5.40 percent), followed by Access Bank (5.25 percent).

While savers have to wait 365 days to access their money, they can consider it an unusual alternative for a fixed period of one year by opening an account with Prosper and closing it immediately.

To take advantage of the deal, savers must open a Prosper savings platform account using this This is the link Money and Prosperity* and select it there. (See below for more information.)

Prosper’s 365-day notice account has a minimum balance of £20,000 and a maximum balance of £250,000 and offers FSCS savings protection of up to £85,000 with Santander International, which manages the savings deposits.

One-year fixed-rate accounts peaked at 6.2 per cent last autumn. But rates fell as the Bank of England base rate stood at 5.25 per cent, and the best deals on This is Money’s independent savings tables now pay just over 5 per cent.

A notice period account is a type of savings account that requires you to give your bank a certain number of days’ notice before withdrawing money. In the case of this Prosper deal, a notice period of 365 days is required, which is considerably longer than most accounts.

The best notice period accounts on the market currently are a 5.25 percent 90-day account from Investec and a 5.15 percent 90-day account from BLME.

Base rate forecasts

Savers should be aware that the base rate is expected to fall and that if cuts do occur, the interest rate on the account will also fall.

The base rate would have to be cut twice by 0.25 percentage points to bring the Prosper deal down to the level of the highest one-year fixed interest rates.

Expectations of rate cuts have been tempered since the start of the year.

According to interest rate forecasts, the Bank of England may not cut rates until September, meaning interest rates will not fall as quickly as previously thought.

If the base rate is lowered to 5 percent, the interest on Prosper’s account will drop to 5.35 percent. If the base rate drops to 4.75 percent, Prosper’s interest will be 5.1 percent, and if it is lowered to 4.5 percent, Prosper’s deal will pay 4.85 percent.

> Discover more about the savings account with a 365-day notice period from Prosper*

What is Prosper and is your money safe?

Prosper is a savings and investment platform launched in 2022, with the mission to help customers invest more cheaply and save better. Prosper’s investment platform currently offers completely fee-free investing in 30 index funds.

Founder and CEO Nick Perrett and Founder and Chairman Ricky Knox worked together on the launch of challenger bank Tandem, while co-founder Phil Bungey was COO at Nutmeg.

In addition to a savings account platform from Akoni, Prosper also offers Sipps, Isas and general investment accounts.

Money you deposit into Prosper’s account with 365 days’ notice is held with Santander International and is covered by the savings protection of the Financial Services Compensation Scheme, up to a maximum of £85,000 per individual saver.

How do I access this Prosper account?

Prosper is a savings, investment and pension platform. To access the 365-day notice period account, you must open a holding account with Bloom*.

From there you have access to a range of savings products from different banks and providers. The 365-day notice period account with 5.78 percent interest (variable tracker) is one of the products that is exclusive to Prosper.

Prosper’s variable rate is 0.55 percent above the Bank of England base rate, which is currently 5.25 percent. However, there is a 0.2 percent fee, resulting in a net pay of 5.6 percent.

There are three steps to take advantage of this 365-day notice period:

1. Open an investment account on the Prosper platform.

2. Deposit funds from your bank account to the holding account on the platform.

3. Choose which savings account you want to open (the rate of 5.78 percent is stated there) and deposit money from your investment account.

You can Open a Prosper account online via this special This is Money link.

The advantage of a Prosper investment account is that once you have one, you can open an unlimited number of savings accounts without having to go through further administration or a new account process.

Your money in the 365 day notice account is protected by Santander’s FSCS. Money in the Prosper holding account is held by Barclays Bank. Your money is protected by the Financial Conduct Authority (FCA) protection rules if Prosper were to fail and by the FSCS if Barclays were to fail.