Marcus raises easily accessible savings rates to 3.75%: should the 800,000 savers stay loyal or move to a better deal elsewhere?
- Online savings and cash Isa increases from 3.5% to 3.75%
- Tandem Bank offers the best easily accessible deal on the market and pays 4.1%
Marcus, Goldman Sachs’ app-based bank, has once again raised interest rates on its popular, easy-to-access savings deals.
As of today, the interest on her online savings account and cash Isa has increased from 3.5 percent to 3.75 percent. This rate includes a 12-month fixed bonus of 0.34 percent – which we explain in more detail below.
It is the sixth time this year that Marcus has raised the rate, which has now increased by 1.25 percent since it stood at 2.5 percent in February.
Marcus pays the same rate on his standard savings account and cash Isa.
Rate Increase: Marcus, which is backed by Goldman Sachs, now pays 3.75% on its online savings and cash Isa accounts.
The new rate will be available to all new and existing customers, with the underlying rate automatically increasing for existing customers.
Someone depositing £10,000 into either account can now expect to earn £375 in interest over the course of a year – albeit if rates remain the same.
At the end of last year, Marcus had £23bn in UK deposits and now claims to have around 800,000 clients.
It hopes the latest rate hike will be enough to at least prevent large numbers of customers from leaving as savings rates rise across the market.
While Marcus’s online savings account is well above the average easy-to-access rate of 2.34 percent, based on data from Moneyfacts, it falls short of the best deals at the top of This is Money’s independent best-buy savings charts.
Tandem Bank is now offering a market-leading easy-to-access deal, paying a whopping 4.1 percent.
Tandem’s deal allows for instant access with no restrictions. It combines an underlying rate of 3.75 percent with a 12-month bonus rate of 0.35 percent to reach 4.1 percent.
Savings app Chip also increased its rate to 4 percent yesterday, while Principality and Sainsbury’s are paying 4.1 percent as convenience access rates climb above 4 percent.
Marcus’ cash Isa deal is much more competitive. The best easy access cash Isa on the market is currently offered by Shawbrook Bank and pays 3.78 percent.
However, unlike most cash Isa deals, savers cannot transfer their existing cash Isa’s to Marcus’ account.
What’s in Marcus’ fine print?
Both accounts can only be opened and managed online and all funds deposited or withdrawn must be transferred to a linked UK checking account.
As for the online savings account, new customers can open it with just £1 and deposit up to £250,000.
Remember that the FSCS only protects savings deposits up to £85,000 per person, or £170,000 in the case of joint accounts.
They can add and withdraw money whenever they like, but there’s a withdrawal limit of £20,000 per day online – although there’s an option to call in if you need to withdraw more.
It’s also worth noting that the account can be opened jointly by two people, but an existing Marcus customer cannot convert their account into a joint account.
Those who opt for the cash Isa deal can deposit up to £20,000 this tax year at the maximum Isa fee.