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Best cash ISAs and savings accounts paying the highest interest rates in May
The war in Iran has 'upended interest rate expectations', according to experts, as inflation in the UK now sits at 3.3% and is predicted to climb significantly higher through the rest of 2026. This increase drives up the cost of food and fuel, eroding the value of savings that earn less than the inflation rate.
However, there is good news for savers: the top rates on savings accounts still outpace inflation. If the Bank of England follows through on its hints and raises interest rates again, banks may respond with even better savings deals.
Adam French, head of consumer finance at Moneyfacts, commented: 'The war in Iran has completely upended interest rate expectations. Just months ago, savers were braced for a steady decline in returns as multiple Base Rate cuts were expected this year. Instead, inflation fears and rising energy prices have forced a sharp rethink.'
Several top accounts offer rates between 4.3% and 4.5%, or even higher. Different account types suit different needs, so ensure your money works hard for you. Below is our regular roundup of the best savings deals; rates are correct at the time of writing, but always check that an account fits your circumstances beyond the headline rate, including any bonus periods, withdrawal allowances, and more. All rates are AER (annual equivalent rate) for easy comparison.
Best cash ISAs
ISAs protect your savings from tax. The annual allowance is £20,000 for this year. New rules planned for April 2027 may limit cash ISA contributions to £12,000 for those under 65, so it makes sense to use as much of your allowance as possible now.
- Trading 212 pays 4.51% with a special code from The Independent. You can withdraw anytime without affecting the rate. The bonus rate applies only to new contributions, not transfers in or previous years' savings.
- Plum pays 4.32%, including a 1.78% bonus for the first year. After that, the rate falls to 2.54%. Plum is a crowdfunder rather than a bank, but money is still protected by the Financial Services Compensation Scheme (FSCS) up to £120,000.
- Tembo offers a 4.3% deal managed via an app with unlimited withdrawals. You also get access to fee-free mortgage advice if interested.
Best easy access savings accounts
- Tembo Money (Home Saver) offers the best overall rate currently at 4.75%, including a 1.75% bonus for the first year. Minimum deposit is £10, maximum £25,000. An additional 1% bonus is available if you open a mortgage account with the bank, giving a total of 5.75% after one year, but only if you use their mortgage services.
- Chase, a digital bank owned by US giant JP Morgan, pays 4.5%, which includes a 'newbie' bonus for the first year.
- Cynergy Bank has an easy online access account paying 4.27%, good for large balances up to £1 million. This rate includes a 2% bonus for the first 12 months.
Best fixed-term saver accounts
Fixed-term deals lock your money away for a set period in return for a guaranteed rate. Unlike easy access accounts, rates are fixed and you usually cannot withdraw before the term ends without penalty. These accounts are sometimes called fixed-term bonds and can be held within an ISA.
- Al Rayan Bank pays 4.7% for one year, with a minimum deposit of £1,000. This is a Sharia-compliant account available through the Meteor Asset Management platform.
- Chetwood Bank offers 4.7% for an 18-month lock-up, also requiring a £1,000 minimum starting amount.
- Kent Reliance provides 4.69% for two years, again with a minimum £1,000 deposit.
More deals are available for longer terms, but if you are considering locking your money away for an extended period, you should also consider whether investing some of it might be more suitable for your circumstances.
