Easily accessible savings hit 4% as Coventry BS launches new deal – and Shawbrook Bank now has TWO best buy cash ISAs
- New ‘Four Access’ Saver offers a very competitive rate of 4%
- Account offers four penalty-free withdrawals per year
- Shawbrook Bank is also launching new best buy cash Isa rates
All savers can now get 4 per cent interest in an easily accessible account after Coventry Building Society launched its new one Celebrate Access Saver which, crucially, is open to both new and existing customers.
The account can be opened online with any amount from £1 to £250,000
Savers can choose to receive interest annually or monthly. This can be credited to the savings account or deposited into a bank account.
Depositors’ deposits are protected up to £85,000 per person under the Financial Services Compensation Scheme, or in the case of joint accounts, this is doubled to £170,000.
4%: Coventry Building Society has launched a new online Four Access Saver account at a competitive rate available to new and existing members.
As the name suggests, there is a small catch. The account offers a maximum of four withdrawals per 12 months from the day the account is opened.
Any additional withdrawals will incur a fee equal to 50 days interest.
This means that depositors who sign up would be wise to treat this account as their rainy day or emergency fund, rather than daily savings that they can pour in and out each month.
Matthew Carter, Head of Savings at Coventry, said: ‘Our new account is ideal for those who only draw money from their savings account a few times a year but want the peace of mind that a restricted access account offers.
‘Whether you save small amounts or larger amounts at once, the account is also ideal for those looking for a very competitive rate for their savings.’
How does it compare?
Although Coventry’s deal is technically on par with West Brom Building Society’s 4 per cent Double Access account it is much more accessible as savers can only apply for the former at a branch or by post.
It’s also worth pointing out that at West Brom, if you do more than two withdrawals, the rate drops to 2.2 per cent.
HSBC also offers its banking customers access to its 4 percent Online bonus savings on balances up to £10,000 – so up to £400 interest per annum.
But they only earn this rate if they don’t withdraw money from their account for 12 months.
Those looking for an easy account with unlimited access should opt for Gatehouse Bank or Shawbrook Bank.
Gatehouse Bank pays 3.9 percent while Shawbrook Bank pays 3.91 percent.
New best buy cash Isas
Savers who need to protect the interest they earn from the taxpayer have a number of new best buys to choose from.
Shawbrook Bank increased its easy-to-access cash Isa to a market-leading 3.78 percent, overtaking Gatehouse Bank’s 3.75 percent.
It also launched a one-year fixed cash Isa that paid 4.63 percent, overtaking Charter Savings Bank’s 4.6 percent deal.
– Check out the best cash Isa rates here.
This is all the more important given that millions of savers will face tax bills on their interest for the first time in seven years – and many could be forced to pay hundreds of pounds.
Introduced in April 2016, the Personal Savings Allowance provides basic rate taxpayers with £1,000 PSA. This means that they can receive up to € 1,000 per year tax-free in savings interest.
Higher rate taxpayers have a PSA of £500 each year. Rate taxpayers do not get a PSA.
According to an analysis by Coventry Building Society, an estimated 3.8 million additional savers will be dragged into this higher tax bracket this financial year.
Adam Thrower, head of savings at Shawbrook, said: ‘Savers have not seen this kind of rate and activity in the market for over a decade.
“It’s a great opportunity for people to check what they’re currently receiving and switch to a better paying provider, or open a new account to reduce some of the impact inflation can have on their cash in checking accounts.” .
‘ISAs are particularly attractive to those with larger savings, as they can benefit from tax-free interest payments on annual deposits of up to £20,000.’