Top variable rate hits new high of 1.2pc

EASY-ACCESS rates with new banks are continuing to rise.

French- owned RCI Bank has raised the rate on its Freedom account from 1.1 pc to 1.2 pc, and given the higher rate to new and existing savers.

It puts it just behind the top deal at 1.25 pc from Ulster Bank. Both accounts are only available online.

With Ulster Bank, your money is covered by the UK Financial Services Compensation Scheme which gives you up to £85,000 of cover if the bank goes bust. RCI Bank comes under the French scheme where the limit is € 100,000 (currently around £88,000).

Neither rate is boosted by an initial bonus, so you won’t see your interest drop after a year.

Top branch deals come from Yorkshire BS Single Access Saver 4 at 1.1 pc or Virgin Money Defined Access Issue 13 at 1.01 pc.

But there are complications. Yorkshire BS allows you to make withdrawals only on the anniversary of opening the account, while with Virgin Money you can make only three withdrawals every 12 months; if you make any more, your rate drops to 0.25 pc.

Top deals on branch accounts which let you put money in and take it out as you wish include National Counties BS Branch Saver 5 at 0.86 pc and Coventry BS Easy Access Saver 4 at 0.85 pc.