HSBC and Nationwide join list of savings providers upping rates

Nationwide Building Society and HSBC have both upped savings rates following the Bank of England base rate hike last week.

It comes after similar moves by a number of savings providers, including banks Monzo, Atom Bank and Chase, and mutuals such as Yorkshire BS and Coventry BS.

The groups have upped rates in response to the Bank of England adding 0.25 percentage points onto base rate to take it to 4.25 per cent. 

Base rate bounce: Some savings providers have upped rates in the wake of the Bank of England base rate hike last week.

Nationwide BS has announced hikes across a range of its variable rate savings accounts. 

The changes, effective from Saturday 1 April, will see the UK’s biggest mutual increasing rates by up to 0.5 percentage points.

Existing members saving in the loyalty saver, loyalty Isa or loyalty single access Isa accounts will see rates rise by 0.5 percentage points to 3 per cent.

Previous and current issues of its triple access online Isas (Issues 12-14) and triple access online saver (Issues 13-15) will also see increases of 0.5 percentage points, with these products now paying 3 per cent. 

Nationwide Building Society has announced hikes across a range of its variable rate savings accounts. 

With both these deals, savers are limited to three withdrawals a year. The account also only lasts for one year, after which savings are moved into an account paying a lower interest rate.

Nationwide is also increasing its instant access account rates, although savers will note this remains shy of the market average and falls woefully below the best buys.

Its instant access saver and instant Isa saver will rise by up to 0.35 percentage points to between 1 and 1.25 per cent, depending on the amount saved.

The average easy access rate is currently 1.85 per cent, according to Moneyfacts. But savers can get as high as 3.4 per cent.

– Check out the best easy-access savings rates here. 

Tom Riley, Director of Retail Products at Nationwide Building Society, said: ‘We remain committed to supporting savers, which is why we have increased rates on our popular loyalty, triple access, and instant access savings accounts where most balances are held. 

‘As a mutual it’s important we balance paying the best rates we can sustainably afford while also investing in wider products and services, such as branches and digital, that benefit our membership as a whole.’

HSBC also propelled itself onto This is Money’s best buy tables after upping its one-year and two-year fixed rate savings deals.

Its one-year fix rose by 0.5 percentage points, from 3.5 per cent to 4 per cent, while its two-year rose from 3.75 per cent to 4.1 per cent. 

HSBC has propelled itself on to This is Money’s best buy tables after upping its one-year and two-year fixed rate savings deals. 

Savers can once again do much better with a number of other providers paying even higher rates. 

The best one-year fix currently pays 4.5 per cent, while the best two-year fix pays 4.62 per cent.

– Check out the best fixed rate savings deals here.

How to pick a savings provider 

With rates rising and often little between the best deals, it can be difficult to know which bank or building society to trust your money with. 

Securing the best rate should always be the number one priority for savers, but there are other factors to consider, according to the popular savings website, Savings Guru.

First, savers need to think about accessibility. Can they manage the account the way that they want to? 

For example, just because an account can be opened online, doesn’t always mean it can be managed online. Some providers are also app only which may not be for everyone.

Second, if customer service is important, then look at Trustpilot scores or Feefo for example. See how others savers rate the service.

Third, make sure the bank is protected by the FSCS and that they don’t share their licence with another bank.

For example, Lloyds, Halifax and Birmingham Midshires are all the same bank licence so they are only protected up to £85,000 across all three, not each one. 

Finally, Work out how much interest will they earn before paying tax. 

With rates increasing, a higher rate taxpayer will start to pay tax on interest on just over £11k saved with Al Rayan’s one-year best buy fixed rate deal. 

Savers should consider whether they should look at cash Isas if they are not already using up their full allowance on other investments or savings.

– Check out the best cash Isa rates here. 

This post first appeared on Dailymail.co.uk