New online banking offer grabs top spot with headline rates

A new online banking offer from a Santander-owned savings provider has earned the top spot, offering a 3.6 per cent fixed rate for a period of 12 months.

The new fixed rate bond, which is being made available by Cahoot until 25 June, is expected to be a highly popular choice for those who can qualify for the offering, especially with banks slashing the rates on their top accounts right and left.  However, the best buy interest rate does come with some serious limitations, such as a £25,000 minimum balance requirement and an inability to make any withdrawals during the savings account’s one-year term, and deposits are capped at a maximum of £2 million.

The fixed rate bond, which matures on 1 August of next year, is automatically converted to a variable rate instant access account in order to grant Cahoot savers access to their cash.  Industry experts say that the new rate will most likely decline by a significant margin, so transferring your cash to a more competitive deal when the time is right will maximise the return on your investment.

Cahoot’s head, Michelle Kent, commented on the new offering, remarking that savers that have an interest in taking out a competitive fixed rate bond from Cahoot should not delay as the risk of over-subscription is high.  The offer could very well be withdrawn before its 25 June deadline in such a situation, Ms Kent explained.

The next-best offers currently available on the market cannot boast the same high rates as the Cahoot deal, but are usually much less restrictive when it comes to the requirements of being considered eligible, as the 3.4 per cent deal on offer from Close Brothers only requires a £10,000 minimum deposit.  Likewise, the £1,000 minimum deposit being asked for by Aldermore Bank grants savers access to a slightly more modest 3.35 per cent rate of return.

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