BEST BUY FIXED-RATE SAVINGS ACCOUNTS SET TO BE CUT, WARNS SYLVIA MORRIS - HERE'S THE BEST DEALS

A battle has broken out at the top of the independent This is Money fixed-rate best buy savings tables as banks and building societies vie for your cash.

It’s a good opportunity for savers but move fast, as rates could fall if the Bank of England cuts the base rate on Thursday next week.

Some providers have raised rates on fixed-rate bonds in recent days. The top one-year deal is now from Kent Reliance at 4.51 per cent, which needs £1,000 to open.

This is followed by 4.5 per cent from Investec, 4.45 from DF Capital, 4.42 per cent from Vanquis Bank, and 4.4 from both Chetwood Bank and GB Bank.

All these benefit from the new £120,000 Financial Services Compensation Scheme limit, meaning your cash is safe up to this amount.

Then comes the one-year bond from National Savings and Investments at 4.2 per cent, where up to £1million is protected by the Treasury.

Providers who do not offer cash Isas have had to ramp up bond rates to attract investors. 

That is because cash Isas have proved far more popular as savers poured money into these tax-free accounts over fears the allowance would be cut in the Chancellor’s Budget.

As it turned out, the cash Isa limit was cut to £12,000 for under-65s – but only from April 2027. 

If you want a shorter-term bond, then this week Oaknorth Bank lifted its rate to 4.31 per cent on its nine-month bond. 

The top rate for six months is 4.24 per cent from Chetwood Bank.

A fixed-rate bond can be handy if the base rate is cut. A fall will trigger a cut rates on easy-access accounts – some lower their rates within hours – while your fixed-rate will carry on paying you the higher rate.

Experts think it highly likely the Bank of England will cut the base rate next week from 4 per cent to 3.75 per cent because inflation has supposedly peaked.

Further cuts are predicted for next year to help counter the headwinds facing the economy. 

If you want to stick to the High Street, head for Co-op Bank – where the rate is 4.18 per cent. 

Small building societies such as Scottish and Suffolk pay 4 per cent.

Don’t bother with the big High Street banks, who have cut rates recently. 

They pay 3.7 per cent at best (HSBC and NatWest), while Halifax and Lloyds offer a miserly 3.25 per cent.

Fixed-rate cash Isas, where interest is tax-free, are also popular, with the top rate at 4.52 per cent from Trading 212*.

Others include Plum* at 4.28 per cent, Kent Reliance and Vanquis Bank at 4.25 per cent and Zopa at 4.22 per cent, while Charter Savings Bank unveiled a 4.24 per cent last week.

In the High Street you can fix in at 4.2 per cent with NatWest, if you open an account before 5pm on 11 December for new customers and 16 December for existing customers. 

Or you can fix at 4.15 per cent with Co-op or 4 per cent with Barclays and Nationwide.

*If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect account placement or editorial independence. 

2025-12-11T10:43:58Z