Yahoo Finance New best-buy two-year bond pays 1.65pc
Atom Bank has increased the rates on its already market-leading one-year and two-year bonds to 1.5pc and 1.65pc respectively, securing its place at the top of the best-buy tables.
The mobile-only provider made the accounts available to all in October last year (previously there was a waiting list). When the bonds were launched to the general public they paid 1.4pc and 1.65pc respectively. However, these rates were far lower than the 2pc and 2.2pc it offered initial customers.
Weeks after the October launch the rate on the two-year bond was cut to 1.6pc.
The accounts can be opened with a minimum of £50 but must be managed on an iPhone, iPad or Android device.
Verdict
The fixed-rate savings market has seen some recent improvement, especially some of the longer-term bonds.
However, the rate increases have been minimal. For example, at the start of December the best five-year bond, from Masthaven, paid 2.01pc. A week later Ikano Bank increased its rate to 2.05pc.
Atom Bank now pays far more on its one-year bond than its closest rival, Ikano Bank, which pays 1.4pc - the rate that Atom paid before the latest increase.
The next best two-year bond, from OakNorth Bank, pays 1.56pc.
The best buy tables are currently flooded with new or less established providers eager to attract customer deposits to fund the borrowing side of their businesses and to make a name for themselves with headline rates.
Tom Adams from Savings Champion, the savings advice sevice, said Atom Bank's move was unusual.
He said providers were more likely to to edge ahead of each other than to "go for it", in an attempt to avoid being flooded with applications.
However, he pointed out that Atom Bank was still "the new kid on the block" and was still trying to entice customers with better rates than competitors.
