Starling Bank to launch its first easy-access savings account – here’s how the rate compares to its rivals

Starling Bank will launch an easy-access account at the end of November, This is Money can reveal.

Starling’s easy access account will pay 4 percent and have no withdrawal restrictions: customers will be able to withdraw money as many times as they want without being penalized by the rate reduction.

In recent years, many Best Buy “instant” access accounts come with hurdles to overcome, including bonuses and withdrawal restrictions.

It is the first time that the digital bank has launched an easy-access account. Until now Starling has only offered a one-year fixed rate account paying 4.05 percent.

It comes as rivals Chase and Monzo revealed they will reduce easy access fees.

Chase will reduce its easy access rate to 3.5 percent from the current 3.75 percent.

Meanwhile, Monzo has revealed it is cutting its easy access rate to 3.6 per cent from 3.85 per cent at the end of the month.

Starling’s 4 percent interest rate is a variable rate, meaning it could rise or fall with changes in the savings market.

This is Money analysis revealed that 27 easy access deals have seen rate cuts or been withdrawn from the market since the Bank of England cut the base rate last week.

Savers can get rates better than 4 percent if they look around. These are Money’s best buy tables showing there are easy-to-access rates paying up to 4.9 per cent.

While they offer eye-catching rates, some of the best easy-to-access offers come with withdrawal restrictions, bonus rates that disappear if you withdraw money, or a high minimum deposit of £25,000.

Starling’s 4 percent rate is competitive compared to other big-name providers.

The Barclay Everyday Saver pays 1.66 per cent, while the NatWest Flexible Saver pays 1.6 per cent. The Santander easy access account pays 1.4 per cent, while the Lloyds easy access account pays just 1.3 per cent.

HSBC offers the highest rate of the big banks for easy access savings, 2 per cent, but this will be reduced to 1.7 per cent on November 18.

There is a bonus version of the account that pays 4 percent if customers make no withdrawals.

Starling’s easy-access account will appeal to savers looking for a high-interest savings account that can be easily opened and managed from their checking account.

The Easy Access account will only be available to Starling’s sole checking account customers at launch, not joint account holders.

The Easy Access account will be accessible through the ‘Spaces’ section of your current account.

It is open to new and existing customers, but new customers will need to open a current account with Starling, as the easy-access account is linked to current accounts, just like Monzo savings funds.

There is no minimum deposit needed to start saving, and savers can deposit up to £1 million into the account; £85,000 of that amount is protected by the Financial Services Compensation Scheme.

Interest on cash held in the Starling Easy Access Account will be earned daily and paid monthly.

Starling’s Maria Vidler said: “Easy Saver helps our customers with a competitive interest rate, penalty-free access and full integration into their Starling app so they can see everything in one place.”