Cash point

At last we’re seeing RATES1 some savings accounts beating inflation – which dropped to 2.5% in March, figures confirmed yesterday.

But there’s a catch – you have to lock away your cash for at least five years.

The best rate you can get is 2.79% on a five-year bond or five-year fixed Cash ISA from United Bank UK (0121 753 6000) on a minimum £2,000 deposit. That’s closely followed by Secure Trust Bank (securetrustbank. com) and Vanquis Bank (vanquissavings.co.uk) both offering 2.65% on deposits from £1,000.

Both Secure and Vanquis accounts can only be set up online.

Up to £85,000 is protected under the Financial Services Compensation Scheme with all three.

Rachel Springall, finance expert at Moneyfacts, said inflation had finally fallen to a level where longer term savers could now beat its impact.

“Some savers may prefer not to lock their money away longer term, so they can move funds easily”, she said. “However, they might be missing out on some of the best deals we’ve seen since the start of 2018.” Lenders have hiked mortgage rates ahead of a predicted Bank of England base rate rise next month.

The average home loan rate has risen 0.25% to 3.65% since mid-March, said price comparison site uSwitch. It would add nearly £5,000 to a £122,000 loan over 25 years.

Experts reckon the Bank of England will up its base rate from 0.5% to 0.75% – a blow to borrowers but a boost to savers. But Yorkshire Building Society bucked the trend today by launching a two-year discounted deal at 0.97% for those with 35% deposits and prepared to cough up a £1,495 fee. BT has refused to rule out job losses after announcing plans to merge two big divisions.

The telecoms giant is combining its business and public sector arm with its wholesale and ventures unit to create a single division called BT Enterprise.

The new set-up will employ 14,000 staff but BT said it was too early to comment on any potential job losses.

The company has already merged its consumer arm with mobile operator EE to create one division.