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Paragon Bank increases rates of interest on savings account to three.67% | Personal Finance | Finance

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Many banks and constructing societies have increased rates across their savings accounts as of late. This comes after the Bank of England’s decision to hike the bottom rate to 2.25 percent in a bid to mitigate inflation. One in every of the newest institutions to pass on this rate of interest increase to its customers is Paragon Bank.

Specifically, the newest intervention from the bank affects its Fixed Rate ISA range of savings accounts.

These latest rates can be found as of Friday, October 7 2022 and is the newest show of support for savers from the bank.

It comes as customers of many banks are seeing diminishing returns from their savings accounts as a conscience of inflation.

This latest intervention from Paragon Bank will likely ease the concerns of most of the group’s customers.

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Following Paragon Bank’s decision, the next savings accounts have seen their rates of interest increased significantly:

  • One Yr Fixed Rate ISA – risen from 2.61 percent AER to three.51 percent AER
  • 18 month Fixed Rate ISA – risen from 2.85 percent AER to three.55 percent AER
  • 2 Yr Fixed Rate ISA – risen from 2.90 percent AER to three.65 percent AER
  • 3 Yr Fixed Rate ISA – risen from 2.91 percent AER to three.66 percent AER
  • 5 Yr Fixed Rate ISA – risen from to 2.95 percent AER to three.67 percent AER

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Derek Sprawling, the savings director at Paragon Bank, emphasised why it’s “necessary” for savers to be supported.

Mr Sprawling explained: “With rising prices and ongoing economic uncertainty, it can be crucial that savers proactively research the financial products which can be best for them and their circumstances – and ISAs can provide savers with a superb opportunity to grow their savings pots. 

“At Paragon, our aim is to proceed providing our customers with excellent returns on their savings and our latest rates show how a Paragon Fixed Rate ISAs should at all times form a part of the conversation when savers are taking a look at what to do to support their financial goals.”

A full list of Paragon Bank’s range of Fixed Rate ISAs might be found on the financial institution’s website.

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The One, Two, Three, and Five Yr Fixed Rate ISAs might be applied for each online and by post.

Nevertheless, the 18 month Fixed Rate ISAs are only accessible for existing Paragon Bank customers and might only be applied for online.

On top of this, savings account holders will have the ability to spread their tax-free ISA allowance across multiple ISAs thanks Paragon’s ISA Wallet.

On top of this, savers who take out one in every of the accounts have the chance to administer their account easily online or by post.

Sarah Coles, a senior personal finance analyst. Hargreaves Lansdown, outlined the present state of rates of interest in relation to the savings account market.

Ms Coles explained: “We’re rapidly reaching the inflection point within the savings market. The gap between what we’re making on our money and what we could make in a set rate account, is reaching the purpose where people say they’re prepared to repair.

“Nevertheless, in point of fact, savers are likely to prove much stickier while rates are rising – and risk missing out on a greater rate.

“The overwhelming majority of our savings is in easy accessibility accounts, and while that is the appropriate place for an emergency fund of three to 6 months’ value of essential expenses, when you hold greater than this, it’s value not less than considering tying up a few of the money in return for a better rate of interest.”

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