Coventry Building Society has increased the interest rate on its regular savings account to 5.5 percent to “support” the nation and “give the best value”.
The move comes three days ahead of the Bank of England’s next Base Rate decision, which has seen analysts anticipate at least a 0.25 percentage point increase, also to 5.5 percent.
Jonathan Wilson, senior product Savings manager at Coventry Building Society, commented: “We want to encourage people to take up a savings habit and that’s why we’re boosting the rate of our Regular Saver by 0.45 percent ahead of any change in the Bank of England Base rate this week.
“Being the headline sponsor of UK Savings Week, we also want to support a nation of savers but most of all, we want to make saving money as straightforward as possible and give the best value.”
Savers can deposit up to £500 each month, meaning a maximum of £6,000 can be saved within its 12-month term.
Interest is calculated daily and applied to the account annually, and Britons must be aged 16 or over to apply.
To illustrate the potential returns of the account, consider that, with the current interest rate, saving the maximum of £500 each month would yield a total interest of £178.75 after 12 months.
The account can be opened and managed online, in a branch, over the phone or by post and there is no minimum monthly minimum deposit as long as the account has a balance of £1.
Savers should feel comfortable investing their money without dipping in, as withdrawals will be subject to a charge equal to 30 days’ interest.
Mr Wilson said: “We know there’s an appetite across the UK for building up savings pots and yet the regular savings market can be complicated with restrictions and excessive terms and conditions which can be a big turn-off for savers.
“Our Regular Saver offers an attractive rate that will encourage people to start saving, along with simple terms that make it straightforward to put money aside.”
Mr Wilson said the mutual has tried to be as “flexible as possible” to cater to people who want to build up their savings in different ways.
He said: “Some may want to save every week, for others it may be once a month, and some might want to take a break from saving from time to time.
“We’ve kept the minimum balance at just £1 and there’s no limit on the number of times savers can put money in, as long as it doesn’t exceed £500 in a month.”
After 12 months, the account matures into Easy Access Saver (7) – a variable rate account which allows unlimited withdrawals and currently pays a rate of 3.1 percent.
The Society’s Regular Saver (5) has been a widely favoured option since the COVID-19 lockdown started to change people’s savings behaviour.
According to the mutual, over 250,000 accounts have been opened since the pandemic – and because it doesn’t require savers to have any other accounts to qualify, it has become a “popular choice” as it’s available to everyone.
