Boost for savers as Marcus raises easy access savings and cash Isa rates
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Goldman Sachs’ popular online bank Marcus is raising interest rates on both easy-to-access savings deals.
Interest will go up from today online savings account And cash isa rises from 2.8 percent to 3 percent.
However, the rate is still only the 19th best on the market – a big departure from the market-based rates Marcus offered when it launched in September 2018.
However, even to get that 3 percent rate, savers must opt for a 12-month fixed “bonus” rate of 0.25 percent, otherwise they’ll only earn 2.75 percent.
Getting an upgrade: Marcus has increased his savings rate, but these are still a long way from the best buys
With the bonus included, this means that someone who deposits £10,000 into either account can expect to receive £300 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 this doubles to £170,000.
How does the account work?
The account can only be opened and managed online and all funds deposited or withdrawn must be transferred to a linked UK checking account.
New customers can open an account with £1 and can deposit up to £250,000.
They can add and withdraw money whenever they like, but there’s a £20,000 per day withdrawal limit online – although there’s an option to call in if they need to withdraw more.
It’s 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 3 percent rate is available to both new and existing customers, with the underlying rate (2.75 percent) increasing automatically, versus 2.5 percent for existing customers.
If they haven’t already done so, existing customers will need to log into their account to add the additional 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 additional 0.25 percent for an entire year.
To do this, they need to log into their Marcus dashboard, click on ‘view’ their online savings and then ‘view their savings’, which will give them the option to extend their bonus term and ensure they have it before secure the full 12-month period. .
How does Marcus compare to other savings deals?
The 3 percent rate means Marcus is competitive against its rivals.
The average easy-access deal pays 1.89 percent, according to Moneyfacts, while the average easy-access cash Isa pays 2.05 percent.
Shortly after launch, however, Marcus promised that his savings rates would always be competitive and go to the top of the best buy tables – which they currently are not.
The Goldman Sachs-backed bank’s online savings account is currently sitting among 18 other easily accessible deals.
But a big selling point of the Marcus deal is also its simplicity and lack of restrictions, which can’t be said of all easily accessible deals.
The best easy access rate is available at savings app Chip, which pays 3.4 per cent on credits up to £85,000.
All money deposited into Chip’s deal is held by ClearBank and is eligible for the Financial Services Compensation Scheme up to £85,000 per person.
– Check out the best easily accessible savings rates here.
The best easily accessible money ISAs are currently offered by Santander and Cynergy Bank.
Santander’s new issue – number 18 – of its online-only e-Isa pays a top floating rate of 3.2 percent.
But beware, the rate only lasts for a year, after which your money is transferred to the bank’s Isa Saver, which pays only 0.6 percent.
If a customer’s savings are in their current Isa Saver or older issues of e-Isa, which all pay lower rates, they can ask Santander to transfer it to the new one for a better rate.
Cynergy Bank also pays 3.2 percent for full easy access. It can be opened with just £1.
Those wishing to make an Isa transfer to Cynergy must do so at the time of application. They cannot transfer ISAs to this deal once it opens.
– Check out the best cash Isa rates here.
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