Santander launches savings accounts with ‘market-leading’ interest rates | Personal Finance | Finance


The bank has confirmed the launch of a new wave of ISAs in the market, offering favorable returns for savers. These include an eISA that pays an interest rate of 1.85 percent and a cash ISA that pays an interest rate of 3.10 percent. Additionally, as part of this announcement, Santander is offering its customers a £50 voucher for ISA transfers.

This comes amid the ongoing UK cost-of-living crisis, with rising inflation eroding returns on savings.

Hetal Parmar, Head of Banking and Savings at Santander UK, explained why the bank is choosing to hike rates now.

Mr Parmar said: “Saving for the future is important to many and our increased cash ISA rates will bring customers greater returns – all tax-free.

“The voucher offer is an added extra that will put more money in the pockets of our customers this fall and our ISA transfer team is on hand to help customers take advantage of these limited time offers.”

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Following today’s rate hike, Santander’s eISA now pays 1.85 percent AER / tax-free, allowing customers easy access to their funds.

The bank also increased interest rates on the following savings accounts:

  • One Year Fixed Rate ISA – Three Percent AER/ Tax Free (Fixed)

  • 18 Month Fixed Rate ISA – 3.10 percent AER/ Tax Free (Fixed)

  • Two Year Fixed Rate ISA – 3.25 percent AER/ Tax Free (Fixed)

All customers, both new and existing, switching from an ISA of at least £10,000 from another bank to a Santander Fixed Rate ISA will receive £50 cashback as a retail voucher.

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This customer bonus can be used at over 100 retailers as well as restaurants and subscription services.

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Every Santander customer will automatically receive their voucher code by email within 30 days of the account transfer.

It should be noted that these increased interest rates and coupon offers are only available for a limited time.

As part of its announcement, Santander warned that this deal could be “pulled out without notice”.

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Inflation in the UK is currently at 9.9 per cent, which is a concern for many savers as they may not achieve expected returns.

While this is a slight fall from the previous month, financial experts worry that high inflation could discourage Brits from saving in the future.

On the subject, Myron Jobson, senior personal finance analyst at Interactive Investor, said, “It’s important to remember that the headline inflation figure can differ dramatically from your personal inflation figure.

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“Any savings you can make now will help you build up reserves for the winter when you really need them most. But that is easier said than done in a livelihood crisis.”

MORE TO FOLLOW…

To mitigate the inflationary damage to people’s savings, the Bank of England has raised the country’s interest rate.

Currently, the UK base rate is 1.75 percent and analysts are predicting it will be hiked even further this week when the finance review’s Monetary Policy Committee (MPC) meets later this week.

Experts expect the Bank of England to hike rates by another 50 basis points in hopes banks like Santander will pass on the rate hike to their customers.

The Bank of England MPC will meet on Thursday 22nd September 2022 to announce possible further rate hikes.





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