Santander has launched a new savings account that offers big interest - and you only need £1

High street and online banking giant Santander has launched a new savings account that will boost peoples' money by a whopping 2.5%. The bank’s new 123 Regular e-Saver will be made available to both new and existing customers from tomorrow - April 6.

You only need £1 to start up an account, and Santander says it's one of the best regular savings accounts for consumers currently on the market from a high street bank.

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This new savings account will offer those looking to boost their finances a fixed rate of 2.5 percent interest AER/Gross for 12 months, says the Express.

Through the 123 Regular e-Saver, customers will be able to access, view and manage their money either online or through Santander’s mobile app. It will be made accessible to those who are existing 123, Private and Select current account customers, who are 16 or over.

Any funds must be paid into the savings account via standing order from an existing Santander 123, Select or Private current account. Customers of the bank will be able to transfer up to £200 per month into Santander’s latest savings offering.

It should be noted that any money which is paid into, and later withdrawn from, the account will go towards the £200 monthly limit.

Overall, this £200 monthly threshold means that savers will see a maximum balance of £2,400 a year.

Towards the end of the 12-month term, the balance, including any interest acquired, will be paid back into the bank’s current account from which the standing order was paid from.

However, if the saver's standing order is in place when the Regular eSaver matures, the account’s final balance and interest will be moved into an Everyday Saver account.

Customers who currently have a Regular e-Saver account will automatically get the new 2.5 percent rate on any new savings. These savings must be deposited after their account matures at the end of their current 12-month period.

As it stands, Santander’s Regular e-Saver, issue 13, has an interest rate of 0.5 percent AER/Gross for 12 months. The bank’s Regular e-Savers customers will immediately roll-over after 12 months to the rate available at the time.

This is set to be 2.5 percent from April 6, 2022, however it will be subject to change and mitigating factors. Hetal Parmar, the head of Banking and Savings at Santander UK, explained why the financial institution is hiking its interest rates across some of its savings products.

Mr Parmar said: “We understand saving for the future remains important to many customers, and following the recent increase to the interest rate on our 123 Current Account, we’re pleased to offer 123 World customers even more value with our new Regular e-Saver.”

As well as these changes to the bank’s savings accounts, Santander will launch a brand new e-saver tomorrow.

Mirroring the bank’s recent announcement, this new product will have a 2.5 percent interest rate for all customers.

UK residents aged 16 or over can open this particular account with Santander for as little as £1.

Due to the rise in the cost of living, the bank is hoping its latest rate hikes will entice more customers to do business and save with the bank.

Furthermore information about the full range of Santander’s savings products can be found on the bank’s website.