Bank raises interest on savings account to ‘market-leading’ 4.53% | Personal Finance | Finance

Birmingham Bank has raised the interest on its three-year fixed savings account to 4.53 percent, earning an “excellent” Moneyfactscompare rating.

Savers need a minimum deposit of £5,000 to launch the account and interest is applied annually on the anniversary of opening and paid on maturity.

Fixed-rate accounts enable savers to lock their money away for a set period at a fixed interest rate. They’re best for those who can afford to leave their money untouched for a specific term and want guaranteed returns. These accounts often also offer the highest rates of interest.

Commenting on the deal, Caitlyn Eastell, spokesperson at Moneyfactscompare.co.uk, said: “Birmingham Bank has increased the rate on its Three Year Fixed Rate Bond.

“The account pays 4.53 percent which is the market-leading rate for its sector, and it is available for investors able to contribute a minimum of £5,000.”

However, Ms Eastell noted: “Careful planning will be required as earlier access is not permitted, although savers will be able to make further contributions for 14 days from the account opening via a nominated account, which may be more positive news.

“On assessment, the account receives an Excellent Moneyfacts product rating.”

While Birmingham Bank may be offering the market-leading deal, competition doesn’t fall too far behind.

Hodge Bank’s Three Year Fixed Rate Bond offers an Annual Equivalent Rate (AER) of 4.52 percent.

Savers need a smaller sum of £1,000 to launch the account and interest is paid on the anniversary of opening. Up to £1million can be invested overall and withdrawals cannot be made until the account matures.

UBL UK’s Three Year Fixed Term Deposit, offered through Raisin UK, falls just behind with an AER of 4.51 percent.

People can open an account with a minimum deposit of £2,000 and up to £85,000 can be invested overall. Interest is paid on maturity and withdrawals cannot be made until the term is up.