Online and app-only savings accounts are currently providing some of the most competitive interest rates available, with deals exceeding 5% AER. These top rates are predominantly offered by newer digital-only banks, rather than traditional high street institutions.
A recent report, Raisin’s Great British Savings Report 2026, indicates that digital banking may influence saving habits. The report found that 39% of individuals are more likely to check their money, and 31% are more likely to transfer funds into savings, due to digital banking.
The lower operating costs associated with digital-only accounts, which lack physical branches, allow providers to offer higher interest rates. However, this shift means a dwindling choice of savings accounts that can be opened and managed in a physical branch. Since January 2015, banks and building societies in the UK have closed 6,896 branches.
While digital accounts offer convenience, including easy setup and real-time notifications, concerns exist regarding branch access and IT outages. A June 2026 survey revealed that one in four UK adults with a current or savings account had experienced a banking IT outage in the past five years.
Savers considering digital providers should verify if their funds are protected by the Financial Services Compensation Scheme (FSCS), which covers up to £120,000. Some 'money apps' are regulated by the Financial Conduct Authority (FCA) and use partner banks to hold funds, meaning savings are protected if these third-party banks are FSCS covered.