Barclays launches high street’s only flexible savings bond

Barclays has launched what it claims is the high street's first two year flexible bond giving savers a competitive rate and the flexibility to withdraw up to 30% of the balance without incurring any charges.

The two year flexible bond pays a fixed rate of up to 3.5% AER and will be the only type of its kind across all the major high street competitors, Barclays said.

The new two Year Flexible Bond - Issue 1 will pay 3.5% AER on balances over £50,000 and the maximum investment is £1 million. The bond will pay 3.2% AER on balances below £50,000 and the minimum investment is just £1.
 
The bond allows three withdrawals of up to 10%, to a maximum 30%, of the initial deposit without notice or charges, which means that someone investing £10,000 could withdraw a total of £3,000 over the two years without incurring any charges. It said that the three withdrawals offer customers the peace of mind that they can access their money instantly in an emergency or earmark it for specific plans in the future.

‘The vast majority of fixed rate bonds on the market do not offer any flexibility without charge or notice; so many customers are losing out on good rates of interest because they are reluctant to lock their money away in case they need it,’ said Andy Gray, head of savings at Barclays.

‘Previously, customers have had to choose between the higher rates of fixed rate bonds or the flexibility of instant access accounts. The Barclays Flexible Bond will give savers the best of both worlds - a competitive fixed rate and the flexibility of having access to a good proportion of their savings when they need it,’ he explained.

‘With base rate staying lower for longer than expected and with no firm indication on when and how quickly rates will start to rise, savers are increasingly opting for fixed rate bonds. Fixed rates bonds have accounted for almost half of all new savings balances across the industry since October 2008 as savers strive to find ways to maximise the return on their savings,’ he added.

Customers taking out the flexible fixed rate bond with Barclays can choose whether they want a regular monthly or annual income or grow their capital. New and existing customers can open their flexible bond instantly through a branch. In addition Barclays current account customers can apply online or by telephone banking.

Barclays continues to offer a one year fixed rate bond paying 2% AER with a minimum investment of £500 and a five year fixed rate bond paying 3.5% AER on balances of £500 to £49,999.99 and 4% AER on balances over £50,000.