Business notice accounts challenge for top rates | moneyfacts.co.uk

Michelle Monck

Michelle Monck

Consumer Finance Expert
Published: 07/04/2020

Traditionally the best interest rates for businesses were available on longer term, fixed rate business bonds. However, the market in April so far shows interest rates for business notice accounts are biting at the heels of longer-term options. We found that the average top ten rates for one-year fixed rates bonds is 1.40% and for notice accounts 1.31%, based on accounts available to open online and a £50,000 deposit. The average rate across all fixed rate bonds of any duration was 1.60%.
The notice account offering the shortest notice period in the top ten rates analysed is from Investec Bank plc at 32 days. The average notice period across the top ten was 92 days.
The very best rate for any business savings account available to open online is from Hampshire Trust’s 5 Year Business Bond (Issue 8) at 1.80% AER, followed by its 3 Year Business Bond (Issue 17) at 1.70% AER. The top one-year fixed rate 1.62% AER from Redwood Bank’s 1 Year Business Savings Bond (Issue 3).
This analysis indicates that businesses may not get the greater level of return usually expected for longer term business bonds. Business notice accounts are offering competitive rates with the advantage of access to funds more quickly than a fixed rate bond. However, unlike bonds, notice accounts are paying variable rates of interest, meaning these accounts could reduce their interest rates in the future.

Six of the best business notice accounts April 2020

The following six accounts are paying the best rates of interest for notice accounts for limited companies. This is based on accounts available online and with a £50,000 deposit.

Provider Account Notice Period Rate AER
Redwood Bank 95 Day Business Savings Account (Issue 6) 95 days 1.55%
Shawbrook Bank 100 Day Notice Business Savings Account - Issue 13 100 days 1.51%
United Trust Bank Business 200d Notice Account Issue 2 200 days 1.35%
Hampshire Trust Bank 95 Day Business Notice (Issue 1) 95 days 1.30%
United Trust Bank Business 100d Notice Account Issue 2 100 days 1.30%
Investec Bank 32-day Notice Account Issue 1 32 days 1.21%

Banks without a UK banking licence have been excluded. 

Business easy access savings offer more convenience

The top easy access savings rate for limited companies who want to open an account online is currently with Saffron Building Society, with a rate of 1.06% AER. This account requires a minimum deposit of £10,000 and pays interest yearly. Businesses wanting monthly interest or who have a smaller deposit, can get very close to this rate with Shawbrook Bank at 1.05% interest on anniversary, 1.04% for monthly interest.

Disclaimer

Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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