Paragon Bank has launched a “competitive” 4.5% interest savings account. The three-year fixed-rate savings bond launches today and is aimed at savers who still want to bank traditionally, only operating via post or the telephone.
Savers who deposit £10,000 into the account would earn £1,411.66 after the three-year term, based on an annual interest of 4.5%. However, account holders can also choose to earn their interest monthly at a slightly lower rate of 4.41%. Existing customers with maturing accounts will be rewarded with a lower minimum opening balance of £500, while new customers will have to deposit at least £1,000 to get started.
Fixed-rate savings accounts can appeal to savers seeking certainty about their returns, particularly in a changing rate environment. By fixing their rate for three years, customers can lock in a guaranteed return for the full term of the account.
Andrew Wright, head of savings at Paragon Bank, said this aligns with the bank’s goal of supporting customers who want to bank offline. He said: “Many savers still value the option to manage their money without going online. Our new rate complements our longstanding commitment to making fixed-term products available by telephone and post, as well as online.
“Increasing the rate on our 3-year fixed-rate bond gives eligible customers the opportunity to secure a competitive return over a longer period without using the internet.”
“Fixed-rate products can play an important role for savers, and those who would rather not apply online are, unfortunately, often left with much lower rates available on the high street.
“Although Paragon doesn’t have a branch network, we’ve been offering fixed-term products by telephone and post for seven years, and 13% of our fixed-rate bond account holders operate their accounts offline.
“This change reflects our ongoing focus on providing competitive options for customers who prefer to manage their savings offline.”
How do other savings accounts compare?
Kent Reliance is offering a 3 Year Fixed Rate Bond with 4.72% interest, however, customers will have to go online to access the rate.
RCI Bank UK is offering a 4.68% interest rate on its 3 Year Fixed Term Savings Account. Customers can manage this over the phone, but the account must be opened online.
Aldermore is offering a slightly lower rate of 4.61% on its 3 Year Fixed Rate Savings Account. This must be opened and managed online.