Easy-access savings rates on rise as 'Marcus effect' shakes up market
Easy-access savings rates have been moving upwards since the launch of Goldman Sachs' market-leading Marcus savings account a little over two weeks ago, MoneySavingExpert.com data reveals.
When Goldman Sachs launched its new Marcus account on 27 September, its 1.5% AER variable interest rate (including a 0.15% bonus for a year) was the highest we'd seen since January 2016 – kick-starting what had been a flat market.
While no new accounts have topped this rate yet, many providers have seemingly responded to Marcus' popularity by upping their own easy-access rates in a fight for customers – so if you're on a paltry rate, now's a good time to move your cash.
If you're on a dire rate, see our Top Savings guide for a list of the best accounts.
Which banks have upped their rates?
This week alone, there have been a number of easy-access rate changes from three 'big name' providers. These include:
- The AA upping its Easy Saver rate from 1.3% to 1.36%.
- Tesco Bank increasing its Internet Saver rate from 1.36% to 1.4%
- Virgin Money increasing its Double Take E-Saver account from 1.36% to 1.42% (though this account heavily limits withdrawals, so its classification as an 'easy-access' account is debatable).
Meanwhile, in the week following Marcus' arrival, Shawbrook Bank increased its easy-access rate from 1.3% to 1.4%, while Paragon (1.37%) and Charter Savings Bank (1.4%) both launched brand new accounts.
And today, RBS launched a Savings Builder account offering 1.5% interest on £1-£10,000 (it has been available from sister bank NatWest since the summer). While its headline rate matches the easy-access Marcus account, it isn't a traditional easy-access account as you must deposit £50+ each month in order to earn interest – meaning it's more closely aligned to a regular savings account.
Interestingly, while competitive rates have disappeared at short notice in the past, all of the above accounts are still available at the time of writing – suggesting providers are having to offer better rates for longer, as they are locked in a battle to secure savers' cash.
How do the new rates stack up?
The Marcus savings account still tops the table for easy access, paying 1.5% AER variable, including a fixed 0.15% bonus for 12 months. You can open it with just £1 and make unlimited withdrawals. Next is Charter Savings Bank which pays a lower 1.4% AER variable on £1000+, without any temporary bonus, and also allows unlimited withdrawals. See easy-access savings accounts for more on our top picks and other options.
It's possible to earn more, but to get a bigger return on your savings you must either be prepared to open a bank account (and meet strict criteria, as well as passing a credit check) or lock away your cash for a fixed term. You can earn 5% on up to £2,500 in a top bank account for savings, while the top one-year fix is 2.02% and you can open it with £1,000, up to a maximum of £250,000 - see fixed-rate saving accounts.