Savers have been urged to consider the merits of notice accounts after the average rate paid on the accounts soared past 1.00% in December.
According to the latest Moneyfacts UK Savings Trends Treasury Report, the typical notice account rate now stands at 1.04% (based on an investment of £5,000), up from 0.97% in November and the highest seen since 2012.
It means the rate has more than doubled since dropping to a record low of 0.49% in February last year, a remarkable renaissance that should put notice accounts firmly on the radar of savers.
That the average no notice rate – which includes easy access accounts – has surprisingly fallen to 0.63% across the month could also inspire savers to look for alternative homes for their funds.
The drop is the first month-on-month fall recorded since March, and comes just two months after the launch of a market-leading easy account by new provider Marcus by Goldman Sachs ® – which at the time paid 0.1% more than its nearest competitor – caused a flurry of rate rise activity in the market.
As a result of the recent rate ups and downs, the typical notice account now pays 0.41% more than is available on no notice accounts, the biggest advantage that notice accounts have held since records began in 2007.
"It is fantastic to see that the average interest rate on notice accounts has breached 1% for the first time in six years and is now showing signs of recovering for those savers looking to boost their hard-earned cash without locking their money away for the longer term," said Darren Cook, Finance Expert at Moneyfacts.
"With the gap between the rates paid for notice and no notice accounts rising, the new year may be the perfect time for savers to consider less convenience when it comes to accessing some of their funds, as those needing to dip into their savings more regularly seem to be paying for the privilege."
This means that, if you're considering a new home for your savings, now could be a great time to take a look at the Moneyfacts notice saving accounts Best Buys to secure the best deal
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 Any products featured may be withdrawn by their provider or changed at any time.