One of the unforeseen consequences of the financial crisis has been the number of new banks offering accounts to UK savers.
Some of these are brand new start-up, so-called ‘challenger’ banks, whilst others are based overseas and have moved to the UK.
Savers are by their very nature cautious people who want to know their money is safe, so it takes some time before these new banks are trusted. We therefore thought we’d highlight five accounts, all protected by the Financial Services Compensation Scheme (FSCS), which pay market leading rates of interest, but who you probably haven’t heard of.
The Punjab National Bank first started to offer accounts in the UK in 2007 and is the third largest bank in India with an astonishing 78 million customers and over 6,000 branches.
Their instance access Cash ISA currently pays 2.00% AER and can be opened with just £1. At the time of writing the interest rate is market leading, with the next best instant access Cash ISA paying 1.75%. Unfortunately you will need to visit a branch to open the account.
The Al Rayan Bank, formerly known as Islamic Bank of Britain, started to offer Sharia compliant accounts to UK customers in 2004 and now has over 50,000 account holders.
The one year fixed rate Cash ISA from Al Rayan Bank currently pays 1.90% gross AER, although to remain compliant with Sharia law this is not classed as interest. The account can be opened with a minimum deposit of £1,000 and is available in a branch, over the phone, by post and online.
Danske Bank is the largest bank in Denmark offering a larger range of savings and banking products to customers here in the UK.
The Danske Bank Junior Cash ISA currently pays a variable rate of interest of 4.00% AER and is available to open in a branch or over the telephone with a minimum contribution of just £25 per month.
Part of the Paragon Group, a FTSE 250 company, Paragon Bank offers a wide range of mortgage and savings accounts to over 400,000 customers in the UK.
Their one year fixed rate bond pays a market leading rate of 2.07% and can conveniently be opened online with a minimum deposit of £1,000; the maximum holding is £100,000.
One of the newest banks having only opened for business in 2015, Charter Savings Bank is nevertheless making waves with its innovative approach and of course, it is a member of the UK Financial Services Compensation Scheme.
The two year fixed rate bond currently pays 2.25% and is available online with a minimum deposit of £1,000.
Need help with your savings?
Trusting your hard earned savings with a bank you have never heard of might seem like a daunting prospect. However, please remember that we have only included accounts from banks which are regulated here in the UK and are members of the Financial Services Compensation Scheme (FSCS).
If you would like advice on the best option for your savings we are here to help.
Call Bev or Sarah on 0115 933 8433, alternatively email firstname.lastname@example.org
Note: The Financial Conduct Authority does not regulate deposit accounts