First Direct Raises Interest Rate on Savings Account to 3.5%, ‘Best in the Industry’ | Personal finance | Finance
The online bank has confirmed that it will increase the rate on its regular saver to an impressive 3.5%. This latest rate hike is set to take effect later this month, April 28, 2022. One of First Direct’s most popular accounts, the Regular Saver Savings Account can be opened online or through the app. form the bank.
Clients can access the account by depositing a minimum amount of £25 and all first direct clients of the first account can use it.
Those who choose to use First Direct’s savings account can deposit up to £300 per month into it.
This means bank customers can save up to £3,600 a year.
All customers with monthly payments of less than £300 can also carry over the allowance from previous months.
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This rate increase for the Regular Saver is 2.5% higher than the previous rate of 1%.
To qualify for the savings offer, customers must open the account from April 28 to secure the 3.5% rate.
In addition to the increase in the regular savings rate, first direct is also increasing the rates for its Cash ISA, bonus savings account and fixed rate saver.
It should be noted that first direct customers can only hold one Regular Saver account at a time.
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Laura Suter, AJ Bell’s head of personal finance, explained: “While banks pass on any prime rate increases very quickly to their mortgage customers, savers have to wait longer and many will not see any increases.
“A lot of people’s savings are just sitting in their checking account or old savings account, earning 0.01%. And those people probably won’t see an increase in the interest rate paid to them, but the banks will pocket the difference to increase their profits.
Despite this, the financial expert believes that the recent rate hikes are a sign that things can only get better.
She added: “We have already seen an increase based on the last two interest rate hikes, with the best easy access savings account paying 0.65% before the December rate increase and now the rate the highest is 1%.
“It means savers can finally get a little more out of their money, but they’ll have to do some legwork to get there.”