Irish savers have felt the sting of low bank interest rates for years. While interest rates have climbed for borrowers, traditional savings accounts lagged behind.
Thankfully, there have been some recent improvements, but navigating the options can be tricky as there are a multitude of options. In this post, we’ll look at the current Irish savings accounts on offer, helping you find the best match for your money.
Rewards for Switching, Not Loyalty
In September 2023, a glimmer of hope emerged when major Irish banks (Bank of Ireland, AIB, PTSB), launched new “market-leading” savings accounts boasting 3% interest rates.
As enticing as they might sound, these rates come with a significant caveat: they only apply to new customer accounts. Existing customers who have faithfully saved with these banks for years haven’t seen a bump in their rates. For many, this apparent penalty for loyalty has left a sour taste in the mouths of many Irish savers.
Finding the Best Option for Regular Savers
If you’re a regular saver, consistently setting aside a portion of your income, here’s a breakdown of the best accounts currently offered by Irish banks:
- Bank of Ireland Super Saver Account: This account leads the pack with a competitive 3% interest rate for regular deposits.
- AIB Online Regular Saver Account: Matching Bank of Ireland’s offering, AIB’s online account also provides a 3% interest rate on your regular contributions.
- PTSB Online Regular Saver: While not quite keeping up with the top contenders, PTSB’s online regular saver offers a respectable 2.5% interest rate on your consistent deposits.
Maximising Returns with Fixed Term Accounts
For those with a lump sum you’d like to save, fixed-term accounts typically offer better rates than regular savings accounts by locking your money in for a set period of time. The table below offers a comparison of the current rates for fixed-term accounts (6 months, 1 year, and 2 years) offered by Bank of Ireland (BOI), AIB, and PTSB:
| Term | Bank of Ireland | AIB | PTSB |
|---|---|---|---|
| 6 Months | 1.5% | 1.5% | 1% |
| 1 Year | 2% | 2.5% | 2% |
| 2 Year | 1.98% | 3% | N/A |
As you can see, AIB offers the most attractive rate for a 2-year fixed term at 3%, while Bank of Ireland and AIB lead the pack for shorter terms. PTSB falls slightly behind in this category.
Challenger Banks: Disrupting the Market with Competitive Rates
The landscape isn’t limited to traditional banks. New players, known as “challenger banks”, are shaking things up. Trade Republic, a German FinTech company, offers a compelling 4% interest rate on your savings, paid monthly. This stands out compared to the offerings from the big three in Ireland but before depositing your savings, consider these factors:
- Maximum Balance: Trade Republic limits your savings to €50,000.
- Access to Funds: While advertised as easy access, there may be nuances to consider compared to traditional savings accounts.
- Deposit Security: Trade Republic currently deposits your savings with other banks, though these deposits are guaranteed up to €100,000 per customer under the EU Deposit Guarantee Scheme.
Revolut have also just announced a new savings product for customers with rates as high as 3.49%.
Choosing the Right Account: It’s All About Your Needs
With a variety of options available, it’s crucial to compare and choose the account that aligns with your specific goals. Here are some key factors to consider:
- Interest Rate: This is naturally a top priority, but remember, it’s not the only factor.
- Minimum Balance Requirements: Some accounts may have minimum balance requirements to qualify for the advertised interest rate.
- Access to Funds: How easily do you need to access your savings? Daily access might be essential for some, while others may be comfortable with limitations associated with fixed-term accounts.
- Fees: Be sure to check for any account fees that could eat into your returns.
Don’t be afraid to explore challenger banks alongside traditional options. By carefully considering your needs and comparing features, you can find the perfect savings account to maximise your return on your hard-earned money.
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