- Savers signing up with Coventry can secure a 5.15%
- The account only allows up to three free withdrawals a year
- Best easy-access and fixed rate accounts are now practically on rates
Coventry Building Society is now top of the easy-access savings tables with a rate of 5.15 per cent.
Savers opening an account with Britain’s second biggest building society would garner £515 of interest on a £10,000 deposit over one year.
There is one slight catch. The account only allows up to three free withdrawals a year.
From the fourth withdrawal onwards, savers will receive a charge equal to 50 days’ interest based on the amount they’re withdrawing.
Online perks: Coventry’s deal is the current market leader when it comes to easy-access but it does restrict savers to three withdrawals a year
The account is only available online and savers can deposit up to £250,000, albeit with only up to £85,000 protected under the Financial Services Compensation Scheme (FSCS) or up to £170,000 in the case of joint accounts.
Savers can choose from annual or monthly interest, which can be added to the account or paid into their linked bank account.
Savers looking for an easy-access account without restrictions can get 5.1 per cent with both Close Brothers or Cynergy Bank.
Cahoot also offers a 5.2 per cent rate, but only on balances up to £3,000.
That said, while unlimited withdrawals is one important factor for savers. So to is the ease and speed at which it takes to open an account.
This is Money’s deputy editor, Helen Crane, has already tested Coventry’s new account.
She said: ‘I opened the Triple Access account at the weekend and it was ludicrously easy.
‘It took me about five minutes from start to finish and didn’t involve some of the tedious ID checks that some savings providers put you through that can take days to complete.’
Easy-access or fixed rates
Coventry’s 5.15 per cent deal means the best easy-access and fixed rate accounts are now practically aligned on rates.
The best fixed rate is a one-year fix currently offered by SmartSave Bank and pays 5.16 per cent.
This will leave some pondering whether there is any reason to lock their money in a fixed rate account, which they won’t be able to access.
However, there is still an argument to fix given that speculation has now turned to when the Bank of England will begin cutting the base rate.
Savings rates peaked above 6 per cent but have come down sharply since autumn
While the best easy-access rates are on par with the best fixed rate deals, these rates are variable and could therefore quickly change if the Bank of England begins cutting base rate.
For savers, it’s a question of whether they should take the chance to bag rates and fix above 5 per cent now, before they are all potentially gone.
Last week, the Bank of England held the base rate again at 5.25 per cent last week, sticking at the level it has been at since August last year.
Following the MPC meeting last week, markets are now pricing in 100bps of cuts – leaving base rate at 4.25 per cent in by the end of 2024.
Read: When will interest rates fall? Forecasts on when base rate will go down