Interest rates boost for savers

24 April 2009 02:28pm

Savers have received some rare good news this week after a string of providers increased their interest rates, research shows.

Eleven different savings accounts providers have either boosted the returns they pay on existing products or launched new ones with competitive rates.

Among those looking to attract savers are a number of big names, such as Halifax, Royal Bank of Scotland and NatWest and Northern Rock, according to financial information group Moneyfacts.co.uk.

Stroud & Swindon Building Society has increased the interest it pays on its Postal Account by up to 0.6%, taking it to the top of the best-buy tables for instant access accounts.

It has also raised rates on the higher tiers of its 30 Day Notice account by up to 1.35%, while Progressive Building Society has launched a new issue of its Postal 7 Day notice account with rates 0.75% higher than previously.

Michelle Slade, analyst at Moneyfacts.co.uk, said: "With base rate being kept on hold last month, savings providers have had a chance to review their positioning in the market.

"We are now seeing those that want to increase their position offering improved terms, which is good news for savers.

"Hopefully in the weeks ahead, other providers will follow and savers will be able to get a better rate of return on their money."

Fixed-rate bonds continue to offer the best returns, with 35 accounts now paying rates of 4% or more, compared with just two at the beginning of March.

Savers have seen the returns they can earn on their deposits dive since the Bank of England began to aggressively cut interest in October last year.

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