NS&I ranked: Savers flock to other savings products as average rates plummet – should you? | Personal Finance | Finance
Savings rates have plummeted to record lows over the last year or so, as coronavirus decimated the economy and the Bank of England was forced to lower the base rate to 0.1 percent. Many financial institutions have been affected by this, including NS&I.
On top of this, NS&I saw £429million withdrawn from customers in May, with only fixed rate accounts also seeing a drop in May (of £1.58billion).
Savers will, unfortunately, be very limited when looking for where they can get a decent return as Moneyfacts.co.uk recently reported the average no notice savings rate dropped to 0.1564 percent on May 14.
This, according to Moneyfacts.co.uk, is the lowest rate since January 2016.
Fortunately, while interest rates above one percent are rare, banks are releasing new deals on a regular basis.
“This option may well appeal to those who are looking to secure a competitive return on their savings and who are also happy to secure their funds away for the term of the account. “As may be expected in the fixed market, neither early access nor further additions are permitted, so savers may wish to plan accordingly.
“The account secures an Excellent Moneyfacts product rating.”
The second account comes from FCMB Bank, with their two year Fixed Term Deposit offering up 0.88 percent.
Eleanor concluded by also examining this deal: “FCMB Bank (UK) has made various amendments to its range of Raisin UK products this week, including launching new offerings and increasing the rate on others. The two Year Fixed Term Deposit is one of the accounts to see an increase and now pays 0.88 percent on maturity (compounded annually).
“This improves the account’s position in our top rate tables when compared to other bonds with similar terms currently available. As is common in the fixed rate market, neither early access nor further additions are permitted, meaning that investors are advised to plan carefully. However, those happy to secure their savings pot away for the term and able to meet the minimum investment amount of £1,000 may find this an attractive option. Additionally, a welcome bonus of up to £50 can be claimed when investors open their first Raisin UK account. Overall, the account earns an Excellent Moneyfacts product rating.