Banks deliver on postal accounts

SAVERS who want to manage their accounts by post can now pick from a host of top deals.

In the past, the best rates have been reserved for those willing to manage their money online. But increasing numbers of new savings providers offer customers the option of managing their account by post.

Just last week, internet bank Paragon announced that savers would now be able to open its market-leading fixed-rate bonds and cash Isas through the post.

The move follows Charter Savings Bank’s decision to introduce postal bonds in November last year, after its research pinpointed high demand from savers.

Other smaller providers, such as Kent Reliance, PCF Bank and Close Brothers, also offer a postal service. It means savers who don’t use the internet are no longer stuck with paltry High Street rates.

The top one-year fixed-rate postal bond currently pays 1.94 pc with PCF Bank, while Paragon offers 1.8pc. By comparison, High Street big banks Halifax and Lloyds offer just 0.55pc if you tie up your money for two years.

These two banks don’t offer one-year bonds — but those that do make for grim reading.

HSBC, NatWest and Barclays pay just 0.7 pc, while Nationwide offers 0.8 pc.

Paragon offers the best postal cash Isa rate, at 1.55 pc for one year or 1.7 pc for two.

Kent Reliance is unusual among the new banks in offering its attractive Easy Access Issue 34 account through the post, too.

The 1.3 pc rate is more than six times higher than Halifax Everyday Saver and Lloyds Easy Saver, paying 0.2pc — and 13 times the miserly 0.1 pc Nationwide’s Instant Access Saver offers on sums up to £10,000.

Another option is Family BS Market Tracker Saver at 1.25 pc. The building society guarantees to pay the average of the 20 best easy-access accounts from its competitors. But you can make only 20 withdrawals a year.

Other decent easy-access postal accounts include Virgin Money Easy Access Saver 32, at 1.16 pc, and Coventry BS Easy Access Saver 6, at 1.05 pc.

You can open and run National Savings & Investments’ Direct Saver, which pays 1pc, by phone but not by post.

You have the usual checks to open an account. Providers can usually check who you are and where you live electronically.

But, if you have recently moved home or changed your bank account, or they can’t match your details, you may need to send a certified copy of your passport and a recent utility bill through the post.

Just like with the big banks, your money is covered up to £85,000 (£170,000 for joint accounts) under the Financial Services Compensation Scheme. With National Savings, your cash is backed by the Government.