The Union Bank of India is offering a 5.15 percent interest rate on its two-year fixed savings account, earning an “excellent” Moneyfactscompare rating.
The account can be opened by savers aged 18 or over with a minimum deposit of £1,000, and interest is paid on the anniversary and at maturity.
Commenting on the deal, Caitlyn Eastell, a spokesperson at Moneyfactscompare.co.uk, said: “Union Bank of India (UK) Ltd has made rate reductions on a range of its Fixed Rate Deposits and Union Premier Bonds this week, including its Two Year Fixed Rate Deposit which now pays 5.15 percent.
“Despite this reduction, the account retains a competitive position within its sector.”
Ms Eastell added that investors who can pay a bit extra can opt into the Two Year Union Premier Bond, which requires a minimum investment of £5,000 and also pays 5.15 percent.
However, she noted: “As is common in the fixed market, savers should ensure that they are satisfied with their initial deposit amount as early access and further additions are not permitted.
“Overall, the account receives an Excellent Moneyfacts product rating.”
The Union Bank of India was founded in 1919 in Mumbai, and all deposits of up to £85,000 (£170,000 for joint accounts) are protected by the Financial Services Compensation Scheme (FSCS).
But while UBI may be offering a competitive deal, it isn’t currently the top rate on offer. Reliance Bank places just ahead with an Annual Equivalent Rate (AER) of 5.25 percent on its Two Year Fixed Term Deposit.
The account can be opened by savers aged 18 or over with a minimum deposit of £1,000. Interest is paid on maturity and withdrawals cannot be made until the term ends.
New research from Shawbrook reveals that a quarter (24 percent) of savers have never switched to a different savings account or opened an additional one, despite significantly higher returns on offer.
When asked why savers haven’t previously switched, more than a quarter (26 percent) said there was no reason. Just over a third (34 percent) prefer to stick with the bank they know, and almost the same number (31 percent) said they’re satisfied with their current savings account and rate.
This group said they have an average interest rate of 2.2 percent on their main savings account.
Adam Thrower, head of savings at Shawbrook, said: “Holding onto that same old savings account is like leaving money on the table.
“Loyalty might be costing you big time and it might only take a few minutes to open a new savings account. Small differences in rates add up — don’t underestimate it, they pile up faster than you think.
“Whatever’s holding you back, it’s time to act – those higher rates won’t last forever.”
