In fact, according to moneysupermarket.com, in the last week alone, a number of lenders, including Barclays, Abbey and Alliance & Leicester have launched fixed rate bonds, all paying in excess of four per cent.

However, the newcomers fail to knock ICICI Bank fixed rate bonds off the top spot for its five year deal, paying 4.4 per cent. Other chart topping bonds include Birmingham Midshires fixed rate bonds, with a two year fix at 4.25 per cent, and a three year fixed rate bond at 3.90 per cent.

Commenting, head of banking at moneysupermarket.com, Kevin Mountford said: “Competition in the fixed rate bond market is really heating up, and savers looking to invest a lump sum for a fixed period can take advantage of some great rates.

“The low interest rate environment has hit savers hard. With the base rate at 0.5 per cent, and many savings accounts paying less than that, many people are questioning whether there’s any point in saving at the moment.

“However,” Mr Mountford added, “there is a greater need than ever to ensure you are getting the best return possible on your money. With rates of four per cent-plus available you can literally boost the amount of interest you earn by hundreds of pounds a year by moving your savings into one of the highest paying accounts.”

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