Best Business Savings Accounts Selection
Cash that is not currently required as capital for the day-to-day running of your business will usually generate more interest in a business savings account than in a business current account.
To help you choose, we’ve put together a selection of some of the top business savings accounts that are on offer this month.*
Latest easy access account deals
Currently on offer from Aldermore is an easy access account paying 1.25% AER/gross. If you’re likely to need quick and easy access to your capital at a later date, this account may be an option to consider. Withdrawals are free and can be made online. They are unlimited as long as you maintain a minimum balance of £1,000 in your account at all times (if your balance drops below this rate, you will be charged 0.05% AER).
Latest notice account deals
Slightly higher rates of interest may be available via a notice account. Manchester Building Society currently offers a 45-day account with a rate of 1.60% AER/gross, for business customers who have deposits from £10,000 to £75,000.
Latest fixed rate deals
For those looking to save for a longer period of time, Principality is currently offering two business fixed rate bonds, which are exclusively available through Fair Investment Company. Both bonds require a deposit of between £10,000 and £5 million. The Intermediary 9-Month Business Bond offers a rate of 0.75% AER/gross with a minimum deposit of £10,000. For those looking to tie up cash for a little longer, the 18-Month Business Bond offers 1.00% AER/gross with the same minimum deposit of £10,000.
AER – Stands for the Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. (As every advertisement for a savings product which quotes an interest rate will contain an AER, you will be able to compare more easily what return you can expect from your savings over time)
Alternatives to fixed rate bonds
If you are prepared to tie up cash for a set period, you might be interested in an alternative to a fixed rate bond known as a structured deposit plan. This type of plan typically lasts for a three to six year term, and could offer higher returns than a traditional fixed rate bond. Structured deposit plans offer returns that are linked to the performance of an Index such as the FTSE 100. Your capital is not put at risk, but any returns are not guaranteed as they are dependent on market performance.
Structured deposit plans are capital protected. There is a risk that the company backing the plan or any company associated with the plan may be unable to repay your initial investment and any returns stated. In this event you may be entitled to compensation from the Financial Services Compensation Scheme (FSCS), depending on your individual circumstances. In addition, you may not get back the full amount of your initial investment if the plan is not held for the full term. The returns from structured deposits are not guaranteed. The past performance of the FTSE 100 Index and any companies listed on the FTSE 100 Index is not a guide to future performance. No news, feature or comment should be seen as a personal recommendation to invest. If you are at all unsure of the suitability of this type of investment, both in respect of its objectives and its risk profile, you should seek independent financial advice.
* Data accurate as of 05/07/2013.