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Savers are being offered the chance to support the armed forces while earning interest on their cash with two new savings accounts.
Coventry Building Society has re-released its three-year poppy Isa and poppy bond accounts which donate to The Royal British Legion (RBL), the charity that runs the annual Poppy Appeal.
However, savers who have used these accounts before should expect drastically reduced interest rates compared with previous years.
Both accounts will pay a rate of 0.85pc – a 50pc drop from last year – and Coventry will donate the equivalent of 0.15pc of the total balances invested to the RBL.
The accounts open today and will run for a limited time. Coventry has not set a date for when the deals will close as it is dependent on how much money is raised. Last year, the building society ended the deals in a matter of days.
Savers can open accounts with just £1, and the poppy bond can hold up to £250,000.
How do the rates compare?
There are much better rates on both three-year bonds and Isas on the market, but very few are available to open for just £1.
Tandem Bank offers a three-year fixed-rate savings account that pays 1.2pc interest. With a £1,000 saving, this would pay £38 in interest after three years compared with £26 from the poppy bond account. However, you would need £1,000 to open a Tandem’s account.
The only other three-year bonds on the market that savers can open for £1 are from Oaknorth Bank at 1.1pc and Virgin Money at 0.75pc, according to data firm Moneyfacts.
There are also better-paying cash Isa rates but very few can be opened with as little as Coventry’s account.
Ford Money offers a 1pc interest on its three-year cash Isa, which would earn £30 interest off a £1,000 saving compared with Coventry’s £26. However, to open this account savers would need a minimum £500.
Virgin Money offers a three-year cash Isa that can be opened for £1 with an interest rate of 0.75pc, while Metro Bank offers a similar deal at 0.55pc. This makes Coventry’s account the best option for smaller savers.
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