Best savings rates: Marcus raises online savings and cash Isa interest to 2.5%

Marcus of Goldman Sachs is raising interest rates on its popular, easily accessible savings deals.

As of today, the interest is on its online savings account and cash will increase from 2 percent to 2.5 percent,

However, savers will have to opt for a 12-month fixed bonus of 0.25 percent to avoid being left with a lower rate of 2.25 percent.

>> View the latest easily accessible savings rates using our independent best buy chart.

With the bonus included, this means that someone who deposits £10,000 into either account can earn £250 in interest over the course of a year.

For those making large deposits, cash is protected up to £85,000 per person by the Financial Services Compensation Scheme and in the case of joint savings accounts, that doubles to £170,000.

How does the account work?

The account can only be opened and managed online and all money in or out must be transferred through a linked UK current account.

New customers can open an account with £1 and can deposit up to £250,000.

They can add and withdraw money as and when they want, but there is a £20,000 per day withdrawal limit online – although there is an option to call in if you need to withdraw more.

It is also worth noting that the account can be opened jointly by two people, but an existing Marcus customer cannot convert their account into a joint account.

How does the bonus work?

The 2.5 percent rate is available to both new and existing customers, with the underlying rate (2.25 percent) automatically increasing for existing customers.

If they haven’t already, existing customers will need to log into their account to add the extra 0.25 percent bonus — just like new customers signing up for the first time.

Existing savers currently have the option to reset their existing 12-month bonus, securing the extra 0.25 percent for an entire year.

To do this, they need to log into their Marcus dashboard, click ‘view’ on their online savings and then ‘view their savings’, which gives them the option to extend their bonus term and make sure they use it for the secure full 12 month period .

How does Marcus compare to other deals?

The 2.5 percent rate makes Marcus one of the best easily accessible deals on the market, while the cash Isa deal now tops our independent best buy rankings.

Goldman Sachs-backed bank’s online savings account is only getting better because of this Al Rayan Bank Easy Access Dealwho pays 2.81 percent.

HSBC also pays 3 percent on its Online Bonus Saving. However, it penalizes depositors for withdrawing funds and is only available to HSBC banking customers.

As for the easily accessible cash Isa deal, Coventry Building Society offers the second best rate and pays 2.25 percent, although access is limited to six times a year.

Do you have to register with Marcus?

At this point, savers will have a hard time finding another genuine, easily accessible savings deal that offers such high returns.

Unlike some of the highest paying ‘easy access’ deals, Marcus comes with no strings attached – except for the £20,000 online withdrawal limit.

For example, a number of other easy-access providers, currently at the top of our best-buy-easy-access tables, limit savers to a certain number of withdrawals per year.

Additionally, with some savers wary of moving their money to smaller, lesser-known providers, the fact that Marcus is a banking service offered by Goldman Sachs may give them some peace of mind.

Many other major banks continue to pay rock-bottom rates on easily accessible accounts.

Can savings rates get better?

Until recently, there were a handful of other easily accessible deals that paid 2.75 percent or more, but most were withdrawn recently.

This has led some to suggest that savings rates could peak.

With the Bank of England expected to raise key rates again on Thursday, November 3, others expect better rates to come.

A spokesperson for The Savings Guru said: “For savers, we believe that a hike in the base rate will boost easy access rates and expect the best buys to have a 3 in front of them, but this could be a gradual move, rather than an immediate response.

“However, it will be good news for savers with easy access, but they may have to switch to take advantage, as we don’t expect the big banks to pass on a big increase.

“The big four banks will probably not pay more than 25 percent of an increase automatically.”