Digital bank Revolut, which provides the global fintech platform and super-app claiming over 10 million users in the UK and 50 million worldwide, has significantly enhanced the interest rates for its UK Instant Access Savings account.
With rates now as high as 5% AER (variable), Revolut’s standard free plan offers a 4% AER (variable), with interest paid on a daily basis.
As many as 1 in 10 individuals in the UK point to low interest rates as a primary obstacle in their savings efforts.
This issue is increasingly pressing as interest rates continue to decline, prompting people to reassess their savings strategies for 2025.
In response to this, Revolut has launched its most competitive rates to date, raising its standard plan interest rate from 2.29% AER (variable) to 4.00% AER (variable).
Revolut’s savings accounts are available with different interest rates depending on the user’s subscription plan.
The rates are as follows: Standard and Plus plans offer 4.00% AER (variable), Premium users receive 4.25% AER (variable), Metal plan users benefit from 4.50% AER (variable), and Ultra users enjoy the highest rate of 5.00% AER (variable).
Interest is accrued on a daily basis, and there are no minimum deposit requirements, although the maximum deposit limit is £200,000.
Additionally, no fees are charged to access or maintain these savings accounts.
A particularly appealing feature for savers is Revolut’s “Spare Change” option, which rounds up each purchase to the nearest pound and automatically transfers the difference into savings.
Users can even increase their round-ups by up to 10 times, accelerating their savings growth.
This feature creates an easier way to save, with users able to build their savings incrementally as they make everyday transactions.
To ensure customers’ funds are secure, savings up to £85,000 are covered by the Financial Services Compensation Scheme (FSCS) through Revolut’s banking partner, ClearBank Limited.
Revolut also offers advanced security, including Wealth Protection, which allows users to set up biometric identification, providing an added layer of security to safeguard savings from unauthorized access.
One of the key advantages of Revolut’s Instant Access Savings account is its flexibility.
Savers have the ability to add or withdraw funds at any time, with their interest continuing to accrue daily.
This on-demand access gives users full control over their savings without the constraints often found in traditional savings accounts. Current customers can reportedly access the new, higher rates with a few taps within the app.
Albert Codorniu, Revolut’s Head of Savings, commented on the enhancement, stating that the company’s boosted rates provide both new and existing customers with the opportunity to set more ambitious savings goals for 2025.
He emphasized that this initiative aligns with Revolut’s commitment to challenging the status quo of traditional banking, aiming to offer better, more flexible financial solutions for customers.
It’s important to note that these enhanced rates come with specific terms and conditions for both savings and paid plan users, and the interest rates are subject to change.
As with all interest earnings, any funds generated will be subject to applicable taxes.
Revolut’s strategic move to increase its interest rates on savings accounts highlights a broader trend in the fintech sector: the disruption of traditional banking models.
By offering competitive rates, flexibility, and innovative features such as round-ups, Revolut is positioning itself as a viable alternative to high street banks, which have been criticized for offering low interest rates on savings accounts in recent years.
As traditional financial institutions remain slow to adapt to the changing needs of customers, Revolut and other fintechs are capitalizing on this gap, attracting savers who are increasingly seeking higher returns and more control over their finances.
Furthermore, Revolut’s ability to offer these rates without requiring a minimum deposit is noteworthy.
It eliminates a common barrier for many consumers, especially those who may not have large sums of money to invest upfront.
The lack of fees further enhances the appeal, as customers can grow their savings without worrying about hidden costs eating into their earnings.
The inclusion of the Spare Change feature also demonstrates Revolut’s commitment to making saving as frictionless and straightforward as possible.
This feature takes advantage of everyday spending, turning it into a tool for long-term saving with minimal effort.
Users can choose to amplify their savings by increasing the round-up multiplier, which caters to various saving preferences and financial goals.
Revolut’s increase in savings rates is a significant step toward providing a more competitive and user-friendly alternative to traditional banks.
With higher interest rates, flexible saving options, and robust security measures, Revolut continues to demonstrate why fintech is becoming a preferred choice for consumers looking for better financial outcomes.