Savings platform Prosper has announced a new bonus rate of 4.21% gross on its 95-day notice savings account, powered by Oxbury Bank. This offering presents a potentially attractive option for UK savers seeking a competitive return on their deposits, particularly those who do not require immediate access to their funds.
The headline rate of 4.21% includes a 0.25% bonus for new Prosper customers who open and fund an account. Without this introductory bonus, the standard rate on the Oxbury Bank notice account would be 3.96%. It operates as a tracker account, meaning its rate is linked to the Bank of England Base Rate and will adjust accordingly. This can be beneficial if the Base Rate rises, but also means the rate could fall if the Base Rate is cut.
To open an account, a minimum deposit of £100 is required, with a maximum deposit limit of £85,000. This maximum aligns with the Financial Services Compensation Scheme (FSCS) protection limit, ensuring that eligible deposits up to £85,000 are protected in the unlikely event that Oxbury Bank were to fail. Savers should be aware that all their deposits with Oxbury Bank, whether direct or via platforms like Prosper, contribute to this single £85,000 limit.
The key characteristic of a notice savings account is the requirement to provide advance notice before making a withdrawal. In this instance, a 95-day notice period applies. This means that if a saver wishes to access their money, they must inform the bank 95 days in advance. For those who need immediate access, it is typically possible, but usually comes at the cost of forfeiting 95 days' worth of interest on the amount withdrawn, a significant penalty that underscores the importance of understanding the terms.
While the 4.21% rate is competitive in the current market for notice accounts, potential customers should weigh the benefits against the lack of instant access. For individuals with an emergency fund already secured in an easy-access account, or those saving for a specific goal further in the future, a notice account can offer a better return than standard easy-access options. However, for funds that might be needed quickly, the 95-day notice period could prove restrictive.
Under UK consumer rights, customers are entitled to clear and fair terms and conditions. It is crucial for prospective savers to thoroughly read the product details, particularly regarding the notice period, any penalties for early withdrawal, and how the tracker element of the rate functions, before committing their funds. This ensures a full understanding of the product and its suitability for their financial circumstances.