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Savers focus on fixed-rate accounts during first quarter

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A near net £40 billion flowed into fixed-rate savings accounts in the period between Jan 2 and April 9 as savers responded to higher rates. 

Paragon Bank analysis of CACI’s weekly data, which compiles adult savings account data from 26 providers, showed the net flow of money into fixed-rate accounts (deposits plus interest credited, minus withdrawals) was £39.5 billion in the period between 2 January and 9 April.

Net flows into ISA fixed-rate accounts stood at £19.8 billion, with £19.7 billion flowing into non-ISA fixed-rate variants.

Conversely, instant access accounts experienced a near £30 billion net outflow during the period.

Derek Sprawling, Paragon Bank Savings Director, said: “The rates offered on fixed savings accounts have increased consistently since the middle of last year and savers have responded by directing their money towards these accounts.”

Derek added: “It was also interesting to see fixed-rate ISAs beat the non-ISA variant in terms of popularity. ISA popularity has been dented since the Personal Savings Allowance was introduced, but the improved rates on offer across the market mean that more people want to shield money from the taxman this year.”

For further information contact:

Michael Clarke
Head of Media Relations
Paragon Bank

Notes to editors:

Paragon Bank PLC is a subsidiary of the Paragon Banking Group PLC which is a FTSE 250 company based in Solihull in the West Midlands. Established in 1985, Paragon Banking Group PLC has over £14 billion of assets under management, helping more than 340,000 customers to achieve their ambitions.

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551.