Many people have been wondering when the base rate rise would translate to higher savings rates in the Best Buys, and now it looks as though things are finally starting to happen! Several providers announced that they'd be raising their rates on 1 December, and one such provider (BM Savings) has done just that, resulting in the best easy access rate available hitting its highest level since last summer.
The BM Internet Saver now pays a rate of 1.45% after receiving a 0.15% boost, which sees it comfortably take the top spot in the easy access charts. Granted, it's not the full 0.25% base rate increase, but it's nonetheless welcome – it means that the top easy access rate is now at a 16-month high, having last stood at 1.45% in August 2016!
BM Savings' market-leading deal can be opened with a minimum investment of just £1, with unlimited further additions and withdrawals permitted. This means that you can add to your pot and withdraw cash as you see fit, and as long as you're happy with online banking and reviewing the account after the first year – this deal is effectively a 12-month bond, and will revert to a standard savings account thereafter – it could be a great home for your easy access funds.
There's been a lot of competition in the easy access market recently, resulting in an upward trend in rates as providers continually look to leapfrog each other to make it to the top of the charts – and it's challengers who have been leading the charge.
For example, just a few weeks ago Paragon Bank launched a limited edition easy access saver paying 1.31%, which was withdrawn from the market just 17 days later. Similarly, RCI Bank upped its leading easy access rate by 0.10% (to 1.30%) before the base rate rise was even confirmed, while Bank of Cyprus UK upped its rate to 1.35% two weeks after, though it dropped it again a few days later once it had achieved the necessary deposits from savers.
"The challenger banks are clearly making the most of an opportunity to entice savers at a time when very few high-street brands pay even 1% on easy access accounts," said Rachel Springall, finance expert at moneyfacts.co.uk, "so challengers are easily gaining the spotlight."
You just need to take a look at our Best Buys to see that it's these smaller providers who are paying the best rates in the market, and with BM Savings upping the ante, it doesn't look as though competition between them is slowing down anytime soon.
The question is, will other leading deals follow suit and raise their rates? RCI Bank has been hovering around the top of the Best Buys ever since itsFreedom Savings Account
was launched – indeed, it was this deal that last paid today's market-leading rate of 1.45% – but now that it's been pipped to the post by BM Savings, we can only hope that it'll feel the competitive pressure to bump up its rate once again.
However, if you do spot a good deal in the weeks ahead, you may want to be quick about it, as Rachel explains:
"There's a welcome rise in the returns on offer on the Best Buy easy access accounts, but a word of warning: don't expect the top deals to be around forever. Paragon Bank's 1.31% limited edition account was only around for two weeks, and the recent market-leader from Bank of Cyprus UK only sat at the top of the tree for three days when it paid 1.35%.
"So, if any savers are thinking of grabbing a new deal they really do need to act fast, as there is no guarantee the table-topping accounts will be around for long."
Check out the market! Take a look at the best easy access rates available, and if you spot a deal you like, strike while the iron's hot. You wouldn't want to miss out, after all.
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.