Notice accounts pay more as savers gain from competition

The rates of notice savings accounts are at their highest levels since 2016, according to new analysis.

Competition among providers means rates have risen by up to 30pc in the past year.

Secure Trust Bank’s 120-day notice account, which paid 1.19pc in March 2017, now offers 1.55pc, according to Moneyfacts, the data firm. The same bank’s 180-day notice account pays a top rate of 1.65pc – the highest rate on offer since June 2016.

The more restrictive the savings account, the more savers can earn. Notice periods tend to be between 30 days and six months. The interest rate is not fixed and can change at any time.

Notice accounts pay more than easy-access – 1.3pc is the top rate from RCI Bank and Virgin Money – but significantly less than longer-term accounts, the rates of which have also been creeping up.

In the past few weeks, providers of fixed-rate bonds and Isas have jostled for position in the best buy tables. The improvements have been small but experts say better deals could be around the corner – welcome news after years of poor interest rates.

Vanquis Bank Savings recently launched market- leading three, four and five-year bonds that pay 2.3pc, 2.47pc and 2.56pc respectively. These are the highest on offer since 2016.

Those accounts are ahead of Ikano Bank’s bonds of the same terms, which pay 2.26pc, 2.36pc and 2.52pc.

OakNorth Bank’s oneyear Isa offers 1.52pc and Virgin Money’s threeyear Isa pays 2pc.

Virgin Money, sponsor of the London marathon, offers top rates