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First Direct has launched a new savings account offering a 7 per cent AER/Gross fixed interest rate.

The account allows savers to deposit between £25 and £300 each month, with a maximum annual contribution of £3,600.

A customer saving the maximum £300 per month would have built a pot of £3,600 after a year.

This means that with First Direct’s 7 per cent rate, this would build to £3,736.50, an additional £136.50 in interest.

Interest is paid at the end of the 12 month period, with calculations made throughout the year.

It follows the Bank of England’s confirmation that interest rates were on hold at 4 per cent

Meanwhile, Nationwide customers are set to be affected by changes to bank accounts from October 1.

The high street lender has announced it is slashing interest rate

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