Savings: Zopa launches account that lets users lock in at better rates

theguardian.com:

The online bank Zopa has launched a market-leading instant access account that also allows savers to lock in some of their money for a fixed-term at a higher interest rate.

The Smart Saver account pays 0.72% on balances from £1 to £15,000 but accountholders can earn up to 1.05% by holding some of their money in linked “pots”.

However, because the account is being targeted at younger customers, it is only available via a mobile phone app.

Customers who pay into the account can create different pots of money for different savings targets, and see them all in one place.

To get the highest interest rate, they need to “boost” the pot and agree to give 95 days’ notice to make a withdrawal. Two other options are available: a notice period of 31 days and an interest rate of 0.85%, and a seven-day notice period with a rate of 0.75%.

Zopa launched as a peer-to-peer lender, offering savers the chance to make returns by matching them with borrowers who paid them interest.

It closed that part of its business late last year after getting a banking licence, and is offering fixed-rate savings accounts alongside the Smart Saver.