Savings: Bank increases interest rate on account to 3.45 percent – ‘rewarding’ customers | Personal Finance | Finance
The bank confirmed changes to its Freedom Savings Account, the RCI Bank E-Volve Saver 14-Day Notice Account and 95-Day Notice Account. This follows recent interest rate hikes from multiple high street banks and building societies to their savings products.
Here is a list of the affected savings accounts and their newly increased interest rate:
- Freedom Savings Account – now pays an interest rate of 3.05 percent
- RCI Bank E-Volve Saver 14-Day Notice Account – now pays an interest rate of 3.10 percent
- 95-Day Notice Account – now pays an interest rate of 3.45 percent.
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Every savings account on offer from RCI Bank can be opened by anyone living in the UK aged 18 or over.
It should be noted that both the 95-Day Notice Account and E-Volve Savings 14-Day Notice Account require a £1,000 minimum deposit.
Enquiries about savings accounts and interest rates can be made by calling the bank’s call centre.
Alternatively, savers can manage their finances by using RCI Bank’s app instead.
Tafari Smith, head of savings at RCI Bank, shared why the financial institution is opting to raise interest rates at this time.
He explained: “Following the Bank of England’s decision yesterday to raise the base rate again, we continue with our commitment to providing savers with competitive rates and simple products.
“When considering the inflationary climate we find ourselves in, RCI Bank feel that it is important for our new and current customers to benefit from a rewarding rate on their savings without any potential pitfalls.
“This is why our Freedom Savings Account offers unlimited access without penalty and our Notice Accounts allow you to store money away so you can focus on other things.”
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This decision from RCI Bank comes the day after the Bank of England’s decision to raise the base rate by 0.25 percentage points.
As a result, the base rate is now at 4.25 percent and this represents the 11th intervention from the central bank in the last year.
Constant hikes to interest rates have been brought on due to Consumer Price Index (CPI) inflation continuing to rise and now being at 10.4 percent.
Concerns have been raised that returns on savings are continuing to be diminished as a result of inflation skyrocketing.
Providing guidance to savers, personal finance expert James Andrews from Money.co.uk said: “If you’re fortunate enough to be in a position to save, be sure to keep an eye on the interest rate your savings accounts are paying.
“To protect your sending power, you need to have a savings interest rate as high as the rate of inflation, which currently doesn’t exist in the UK.
“So your job becomes finding the highest rate you can for your savings, to lose as little money as possible in real terms. Changing accounts is a great way to garner as many benefits as possible for as long as possible.
“It’s also wise to make sure you get full value out of any interest you earn. You will not pay tax on the interest earned from an Individual Savings Account (ISA), for example.”