After bottoming out in early 2026, fixed-rate savings deals have been climbing back up. Bank of England data shows the average 1-year fixed-rate bond rose from a low of 3.51% in March 2026 to 4.04% by August 2026 — even though the Bank of England's own base rate has held steady at 3.75% throughout the year.

Easy-access rates have moved far less over the same period, hovering close to 2.1% on average, so the gap between locking money away and keeping it instant-access has widened. Following the low point of early 2026, this marks a welcome shift for savers willing to fix their rate.

Source: Bank of England, Quoted household interest rates (series IUMWTFA, IUMB6VJ), monthly data to August 2026.

Yet it's not just savings accounts that are competing for savers' cash. A number of current accounts also offer headline-grabbing interest rates in an effort to attract new customers — some reaching 5% AER or more on a limited balance, often for a fixed introductory period.

Keeping cash in a bank account (a brief history)

In years gone by, keeping a large amount of cash in a current account was best avoided. That's because the interest rates on offer were often miserly.

Instead, savers were better off transferring the majority of their cash to a competitive savings account, keeping only a small proportion in their current account for everyday spends.

Yet over the past few years growing competition for customers has forced banks to re-think their offerings. Some banks began offering cashback on bills. Others offered cash incentives to new customers for switching accounts. Meanwhile, some banks focused on headline-grabbing interest rates. These are known as 'high interest bank accounts.'

What high interest bank accounts are available right now?

Rates on both savings and high interest bank accounts have moved since early 2026, making it a good moment to compare current options. Not only have rates on normal savings accounts increased, but there are also a number of high interest bank accounts paying generous rates of interest. These accounts typically aren't as flexible as normal savings accounts, and some will only allow you to earn interest on small sums.

High interest bank accounts tend to follow one of two structures:

Banded or capped rates: a headline rate that only applies up to a set balance (commonly £1,500–£5,000), with a much lower rate on anything above that threshold. These are often tied to a linked rewards scheme, which may come with its own monthly fee, minimum pay-in requirement, or minimum number of Direct Debits to qualify.

Boosted introductory rates: a rate significantly above the account's standard rate, fixed for a set period (commonly 12 months) on a capped balance, reverting to a much lower ongoing rate once the introductory period ends. These are usually restricted to new customers, or customers who haven't held that account before.

Some providers also run limited-time cash incentives for switching your current account to them, separate from the interest rate itself. These come and go frequently and vary by provider

As with savings accounts, FSCS protection applies to bank accounts too (cover is £120,000 per person, per institution; £240,000 for joint accounts) so this is worth factoring in.

For up-to-date rates and offers, see our best bank accounts guide.

Bank account or savings account: which wins?

Current accounts can offer higher headline rates than easy-access savings accounts, but this usually comes with a low balance cap, meaning the actual amount of interest earned is often modest even at an attractive-looking rate.

Dedicated savings accounts more commonly allow interest to be earned on much larger balances, even where the headline rate is lower. Comparing the total interest you'd actually earn (rate multiplied by the capped balance ) can be a useful exercise, in addition to comparing headline rates alone.

For a list of the top easy-access accounts available right now, take a look at our best savings accounts guide.

Don't forget tax on savings interest...

For the 2026/27 tax year, your Personal Savings Allowance (PSA) remains frozen at £1,000 for basic-rate taxpayers and £500 for higher-rate taxpayers. Additional-rate taxpayers do not receive a Personal Savings Allowance. With interest rates sitting around 4% to 5%, it is much easier to exceed these limits; for example, a higher-rate taxpayer with £10,000 in a 5% account will hit their £500 limit exactly.

Please note that tax treatment depends on your individual circumstances and may change in future. The content in this article is provided for information purposes only. It is not intended to be, nor does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence.