Interest rates on savings begin recovery

Interest rates paid to savers are on the road to recovery following months of gloom, Moneyfacts.co.uk said this week.

A number of providers have increased rates or launched new competitive accounts, the price comparison website said.

“Savers have received nothing but bad news of late and it looks like things have finally turned a corner,” said Moneyfacts.co.uk analyst Michelle Slade.

Thirty five fixed-rate bonds now offer rates above 4.00%, compared to just two at the beginning of April.

Whilst most of these are two year bonds, West Bromwich Building Society is paying 4.30% on its 13 month bond.

Variable rate savings accounts have also improved, with Stroud and Swindon Building Society increasing rates by up to 0.6% on its postal account, and by up to 1.35% on its 30 Day Notice account.

Chris Eagle, commercial manager at CreditChoices.co.uk, said: “Savers have been suffering for too long with low rates and dismal returns.

“Hopefully we will see more providers follow suit and banks will once more compete for our savings with a rates war.”

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