Digital-only banks are leading the charge on instant access savings rates, with Tandem and Zopa both launching new best buys.
Earlier in the day, Zopa Bank raised the rate on its Easy Access Smart Saver to 3.21%, while Tandem Bank raised its Instant Access Account to 3.2% on Friday.
Both accounts allow savers to withdraw funds without any restrictions, making them potentially more attractive than some of the other best buys, which you can view in our easy-to-access savings accounts charts.
With Zopa, savers can also increase their rate by up to 3.47% by locking in money longer, through a selection of linked notice accounts.
Top of the chart: app-based Zopa Bank offers one of the best easy-to-access savings rates on the market.
Although Yorkshire BS pays 3.35% higher on its Rainy Day account, this is only paid out on the first £5,000 and withdrawals can only be made two days a year. Anyone with a balance over £5,000 will earn less than 2.85%.
Similarly, Coventry Building Society last week launched a new limited access account paying 3.1%. However, the account only offers six penalty-free withdrawals each year.
Any further withdrawals are subject to a charge equal to 50 days interest on the amount withdrawn.
Unlike some of the best deals that make up This is Money’s best savings tables, Zopa and Tandem have a good reputation for passing on any rate hikes to existing customers, which means they do that rare thing of rewarding the loyalty rather than punishing it.
A number of banks and building societies are guilty of creating new issues when they raise rates, leaving customers who have subscribed to older issues with lower rates.
Of the providers currently paying 3% or more, Coventry BS, Yorkshire BS, Aldermore Bank, Al Rayan Bank and Sainsbury’s Bank are all guilty of doing so.
However, one thing that savers will need to master is that Tandem and Zopa are entirely app-only. This means opening and managing either account using just a smartphone.
Increased savings: Zopa’s easy access rate is 3.21%, but savers can increase their rate up to 3.47% by locking in longer.
Zopa or Tandem?
Since launching as a bank in 2020, Zopa has attracted £3bn in deposits. It is no longer a peer-to-peer platform but a fully licensed and regulated bank and offers savers FSCS protection up to £85,000 per person.
Zopa also offers one of the best app-based banking experiences.
This is Money recently tested seven savings apps and Zopa came out on top.
The registration process only takes a few minutes, and from there, logging into the app requires either a fingerprint scan or a six-digit passcode.
It takes up to two hours to transfer money to and from Zopa, but most transfers take around 20 minutes.
Savers can get started with its easy-to-access offer by simply transferring £1 and can add up to a maximum of £85,000.
Someone depositing £10,000 under Zopa’s 3.21% deal could expect an annual return of £321 in interest, even if the rate stays the same.
Instant Access: Tandem pays 3.2% and won’t impose restrictions on the number of withdrawals like many savings providers.
Tandem was launched in 2014 and is a fully licensed UK bank with a strong fintech banking platform serving over 270,000 customers. Just like Zopa, savers have FSCS protection up to £85,000 per person.
Tandem Bank also did our roundup of the best app-based savings apps, earning a rating of 4.3 out of 5 on the Apple App Store.
The sign-up experience took a bit longer than with Zopa. He asked for some additional details such as job type and salary.
Adding money and withdrawing money is quick and easy to do, either via open banking or bank transfer.
In most cases the money will be in your account within 2 hours, but sometimes it can take up to 24 hours to arrive.
There is no minimum deposit to open Tandem’s instant access deal and thereafter savers are free to save up to £250,000.
It should be noted that although savers can earn 3.2% with Tandem, to do so they must increase their return via a bonus rate of 0.35 percentage points for 12 months.
THIS IS FIVE OF THE BEST CASH ISA MONEY OFFERS
Some links in this article may be affiliate links. If you click on it, we may earn a small commission. This helps us fund This Is Money and keep it free to use. We do not write articles to promote products. We do not allow any business relationship to affect our editorial independence.
