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Vanquis Bank 1 Year Fixed Rate Bond

By: Sandy Kenrick | Updated: 4th January 2021.

Great for: Competitive fixed rate interest
4 stars question mark

Vanquis Bank 1 Year Fixed Rate Bond

Vanquis Bank Savings logo
  • Interest Rate (AER):

    0.44%
  • Account Type:

    1 Year Fixed Rate
  • Account Minimum:

    £1,000
  • Account Maximum:

    £250,000

Account protected by the FSCS up to £85,000

WHAT YOU NEED TO KNOW

    • Minimum deposit £1,000
    • Maximum total balance £250,000
    • Open as a sole or joint account
    • Deposit must be made within 30 days of opening via a single payment
    • Annual or monthly interest options available

 

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what we like

  • Competitive interest rate
  • Annual or monthly interest options
  • Sole or joint accounts

WHAT YOU NEED TO KNOW

    • Minimum deposit £1,000
    • Maximum total balance £250,000
    • Open as a sole or joint account
    • Deposit must be made within 30 days of opening via a single payment
    • Annual or monthly interest options available

 

  •  

 

DISCLAIMER

Bottom line

Vanquis just falls short of top spot with their 1-year fixed-rate bond. Its attractive interest rate and grace period of 30 days to fund the account earn the product some brownie points. For Vanquis to get this product to take the coveted first position, however, they would have to up an already impressive interest rate, plus do some tweaking to their deposit thresholds.

 

What I like

What’s not to love about a predictable fixed-rate account that happens to have a good interest rate? Vanquis is hitting some pretty high notes with this product.

  • Fixed rate predictability: There is something to be said for a fixed-rate product, as the outcome is predictable. While Vanquis might not offer the highest rate on the market, the offered rate is still higher than most.
  • Interest payment options: Customers can opt to have their interest paid monthly or annually. Those who opt for monthly, only have a rate drop of 0.01%. Customers who wish to invest £1,000 for the 12 months and opt for either monthly or annually won’t even feel the difference in that slight rate adjustment.
  • Simple opening procedure: Instead of heading out to a brick-and-mortar, Vanquis offers its existing customers the opportunity to open a 1-year fixed rate bond online. Customers can also view and manage their account online.
  • No temptation to spend: If you find it hard to resist adding items to your online cart, this is a great option. It’s a fixed deposit product, which means that the funds cannot be accessed unless it’s an emergency. Early withdrawal of funds could result in penalty fees.
  • It enjoys FSCS protection: Qualifying deposits up to £85,000 enjoy FSCS protection. Customers are encouraged to read the conditions of the protection as there are limitations and restrictions.
  • Stress-free account funding: Customers who are in a hurry to open the account to benefit from the rate, have 30 days to fund it. For those who are waiting for funds, this may come as a great relief, as some of the competitor products only offer 14 days.

Why trust me:

I spent ten years as a small business manager in a bank, curating portfolios that spanned fledgling startups to those on the cusp of big business. As a writer, I know that my biggest asset is an in-depth knowledge of the behind-the-scenes of the banking world, along with a strong desire to see clients matched with the right products. I also have a nose for sniffing out gimmick overload and hidden costs, and finding the best deal for the consumer.

What could be improved

While I think that this is a strong contender, Vanquis just falls short of the mark by hoping customer loyalty will make up for their lack of deposit flexibility. There is room for improvement.

  • The great rate can be better: Vanquis might be up there with the best, but they’re not leading the pack when it comes to interest rates.
  • Minimum opening deposit should be lower: Those who are new to fixed-term or fixed-rate deposits, might not have £1,000 to put away for 12 months. To encourage a larger percentage of the customer base to save in longer term products, the minimum deposit needs to be more accessible.
  • Maximum deposit amount should be more competitive: Vanquis is boxing themselves in by limiting the interest payable to clients, by making the maximum deposit allowed £250,000. This doesn’t do much to encourage high net worth individuals to take up the product.

Important things to consider

If a financial emergency occurs and you need to access the funds, the bank may charge penalty interest, which means you may access your funds but lose the interest you’ve earned. It’s also important to know that the tax is payable by the customer and is not automatically deducted from the return by the bank. Therefore, customers should make note of this on their tax return.

It’s also important to note that while the account can be funded in 30 days as opposed to shorter terms, customers have to do this in one deposit. Some other accounts allow for multiple deposits albeit the shorter deposit term.

How to apply

New and existing customers can apply online. Further instructions and changes can be done online, or by post, telephone, or secure message.

Is the Vanquis Bank 1 Year Fixed Rate Bond right for you?

This is a good starting point for those who wish to build up a nest egg, or increase their wealth in what is considered a lower-risk product. Fixed-rate deposits are also fixed term, which means that no early access is allowed on the product. This is not an ideal product for emergency savings, as the money is tied up for a year.

See the Best 1 Year Fixed Rate Bonds