Spring Launches 5% Savings Account, Challenging Top Rates

Spring has introduced a new savings account, Accelerate Saver, offering a 5% annual interest rate on balances up to £5,000. This launch positions the app-only account as a best-buy, according to independent savings tables, surpassing the previous top offering from Cahoot's Sunny Day Saver, which also offers 5% but is capped at £3,000.

Spring's initiative targets the substantial amount of money Britons are estimated to hold in current accounts, which typically offer no interest. The company notes that approximately £322 billion is held in such accounts, with an average balance of £4,008, suggesting many individuals are missing out on potential earnings. Derek Sprawling, head of money at Spring, stated that moving funds into a dedicated savings account is a simple step toward making money work harder.

The number of savings accounts paying above the Bank of England's base rate of 3.75% has reached 1,412, the highest figure since July 2012, according to Moneyfacts. Spring's Accelerate Saver requires a minimum deposit of £10. If the maximum £5,000 is deposited and earns 5% interest over a year, savers could gain £250.

Users must be comfortable managing their finances digitally, as Spring operates solely through an app. The account is part of Paragon Bank, and deposits are protected up to £120,000 under the Financial Services Compensation Scheme.

Other Recent Savings Offers

This development follows the recent launch of an instant access account by First Active, a digital offering from NatWest. This account provides a 4.5% interest rate, which includes a 1.5% bonus for the first 12 months, making the underlying variable rate 3%. It allows deposits from £1 up to £1 million.

Saga also offers a 4.5% rate, comparable to First Active, but with a 1.64% bonus for 12 months, meaning First Active has a superior underlying rate.

It is important to note that interest earned on these accounts may be subject to taxation if it exceeds an individual's personal savings allowance, as they are not Isas.

Fixed-Rate Isa Options

For those with remaining £20,000 tax-free Isa allowance who are willing to lock away funds for at least a year, longer-term Isa rates are also seeing changes. In August 2026, the average one-year fixed Isa rate rose to 4.24%, slightly exceeding the average one-year fixed rate of 4.23% for regular savings accounts, according to Moneyfacts. While top-paying one-year Isas do not yet reach 5%, they offer rate certainty and allow for larger deposit amounts compared to the £3,000 or £5,000 limits on the best-buy Cahoot and Spring accounts, respectively. Vanquis Bank offers a 4.69% rate on its one-year fixed-rate Isa, with a minimum deposit of £1,000, and allows transfers from other providers.