The Mail on Sunday

Best fixed-rate deals are longer term

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SAVERS looking for fixed rates can still achieve decent returns, but they have to lock up their cash long term for the best deals.

State Bank of India, which is regulated by the Financial Services Authority in Britain – meaning savings up to £50,000 is protected – has launched a fixed-rate bond paying five per cent gross. But it has a five-year term. The bond pays interest monthly.

If savers want a fixedrate cash Isa they can get the same five per cent rate with Yorkshire Bank (see table above), but again over five years.

‘It is still tough out there for savers, particular­ly those who need a monthly income or who want the security of fixed rates,’ says David Black, principal resear- cher at independen­t data compiler Defaqto.

‘Fixed rates have been falling in recent weeks. It is even more important for savers to shop around.’

Indian-owned ICICI has the best mediumterm fixed-rate bonds.

The bank is fully regulated by the FSA and savers are protected under the Financial Services Compensati­on Scheme. Over four years the rate is 4.5 per cent gross, 4.6 per cent over three years or 4.1 per cent over two years.

The best one-year rate is from the Post Office at 3.3 per cent. This bond is supplied through Bank of Ireland, which has saver compensati­on up to 100,000 euros, provided through the Irish Deposit Protection Scheme.

 ??  ?? SHOPPING: David Black
SHOPPING: David Black

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