Lovemoney Awards: First Direct is your favourite savings provider

Ed Bowsher
by Lovemoney Staff Ed Bowsher on 26 November 2012  |  Comments 5 comments

First Direct is the clear winner in the Lovemoney Awards savings category.

Lovemoney Awards: First Direct is your favourite savings provider

Last week we announced the credit card winners in the Lovemoney Awards 2012.

Now we’re moving to the winners in our savings awards.

Remember these awards are voted for by Lovemoney readers – they reflect the verdict of our readers on the financial products that they use. Read more in The Lovemoney Awards 2012 - how it works.

So, without further ado, here the results:

Customer service

Winner

First Direct

Cheer

Natwest

Cheer

Coventry BS

Interest rate

Winner

Coventry BS

Cheer

Post Office

Cheer

Santander

Consistency

Winner

First Direct

Cheer

Natwest

Cheer

Coventry BS

Accessibility

Winner

First Direct

Cheer

ING Direct

Cheer

Lloyds TSB

Most loved

Winner

First Direct

Cheer

Natwest

Cheer

Coventry BS

You’ll see that First Direct has won three of the four categories and is also the overall winner.

I’m not surprised that First Direct has done so well. The bank has a fantastic reputation for customer service and also won the overall Lovemoney savings award last year.

Consistency

I also think that First Direct’s victory in the ‘consistency’ category is especially noteworthy. Too many banks play a game of launching savings accounts with very attractive rates and then slashing the rate a few months later.

So a bank that consistently pays a decent rate month-after-month is very attractive. If you’re looking for that kind of consistency in a savings provider, our readers are telling you that First Direct is the place to go!

Interest rates

That said, First Direct does have one weakness in the savings arena. You won’t often see a First Direct savings account in a list of the top-paying savings accounts. No doubt that’s why First Direct didn’t win in the ‘interest rate’ category.

Instead that honour went to Coventry Building Society which often offers table-topping accounts. For example, Coventry launched a top-paying instant access account in June and also offered a market-leading, inflation-beating fixed-rate bond in July.

And then every October Coventry offers the Poppy savings bond, which pays an attractive rate to savers while also donating funds to the Poppy appeal.

Coventry is also offering the top-paying instant access account right now, although it does come with a catch. The Coventry BS Family Saver account pays 3% which is well ahead of any other instant access account. However, you can only open the account if you have a family and receive Child Benefit. What’s more, your Child Benefit must be paid directly into your Coventry account.

And if you’re looking for a Cash ISA, Coventry’s 60-Day Notice ISA is one of the best accounts, paying 3.25% interest.

Fixed rates

However, if you’re looking for a fixed rate bond, Coventry really isn’t competitive at the moment.

The best rates are paid by BLME which offers a 4.2% ‘anticipated profit rate’ on its five-year Premier Deposit Account. The account pays ‘profit’ instead of ‘interest’ in order to comply with Sharia law. However, the big downside with BLME’s bonds is that you need a £25,000 minimum deposit.

If you don’t have that kind of spare cash, you might like the Triodos Three Year Ethical Savings Bond. You only need a £500 minimum deposit for this account which pays 3.25% annual interest. What’s more, some folk will derive satisfaction from depositing their cash with a bank that takes an ethical approach.

Back to First Direct

You may be thinking that 4.2% doesn't seem like a great rate when compared to rates on your average savings account only a few years ago. And that's undoubtedly true. Interest rates on savings accounts have been pathetically low since 2009 and they're getting worse.

Given that background, you may prefer just to go with a bank that is consistent and offers good customer service. If that's the case, First Direct should fit the bill nicely.

Compare savings accounts with Lovemoney

More from Lovemoney:
Lovemoney Awards: John Lewis is your favourite credit card

Nottingham BS launches 6% savings account

Cheshire Platinum Monthly Saver offers 5% interest and instant access

Is there any point opening an easy access account?

First Direct comes top again for customer service

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Comments (5)

  • Basia02a
    Love rating 49
    Basia02a said

    Quite astonished at First Direct winning. Whilst they do have the best customer service, most of their accounts pay almost nothing in interest. Its easy to be consistent when you are paying little interest, apart from on their regular saver. I live in part on my interest, and would be destitute if I was saving with FD

    Report on 28 November 2012  |  Love thisLove  2 loves
  • mjpower4
    Love rating 1
    mjpower4 said

    Totally agree with @Basia02a - easy to be top dog when you pay peanuts in interest. I also note that typical of Lovemoney to fawn over First Direct as per usual but nothing said about Natwest? Surely one of the older banks should get some kudos for consistency, customer service and most loved. They have worked hard on their CS and it shows - the phone staff are always excellent in my dealings with them and their current attention to detail deserves praise (Again only from my dealings).

    Report on 28 November 2012  |  Love thisLove  0 loves
  • meldrewreborn
    Love rating 70
    meldrewreborn said

    I've banked with first direct since the early 90's - I'm probably one of their customers with the longest length of association. But I have accounts with others too, although they remain my first choice for my main current account , and if i could only have one it would be with them.

    Having said that their regular saver pays 8% on £300 per month for a year, which is a great way to save up for a cash ISA, and once complete you just open another. I will not put up with sub standard service and First direct have only once fallen foul of my wrath, and their compensation was generous - probably because it happens rarely.

    The only gripe I still have is that they will not open an account for somebody acting as an executor - but HSBC the parent company do and its free to operate!

    Report on 28 November 2012  |  Love thisLove  0 loves
  • coloratura
    Love rating 81
    coloratura said

    Having seen good reports about First Direct I was already to sign up when I discovered that I had to put in £1,000 per month to get a reasonable rate (there is no such thing as a consistently good rate nowadays). Unfortunately I am self-employed and whilst some months may be very good others may not be, so although it might be that I could put more money in sometimes, it might be less on others occasions. Also what happens when I decide to retire and live on my pension ? Someone, for example, might have £1,000,000 in savings (perhaps due to a windfall or lottery win) but when they retire they may only have a small pension that would not cover depositing £1,000 a month after paying bills and they may also need to start to live off their savings at that time anyway? I think First Direct would be better to accept all reasonable customers - after all banks usually ask for proof of funds.

    Report on 28 November 2012  |  Love thisLove  0 loves
  • Basia02a
    Love rating 49
    Basia02a said

    The regular saver is a good rate, but at £300 a month does not help much if you have 80k in savings and the rest earns nothing. I have been with them since the 80s, but stopped using them because I needed a better interest rate. I would say their customer service has always been excellent.

    Report on 29 November 2012  |  Love thisLove  0 loves

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