UK Shariah-compliant challenger bank, Gatehouse Bank, has raised the rate on its 1 Year Fixed-Term Deposit (FTD) account to 2.00% to celebrate the rebranding of its savings products.
The bank’s Milestone Savings brand has been retired, and all savings products are now being offered as Gatehouse Bank.
The change is designed to make it easier for the bank to communicate its brand and offering to customers. There will be no change to the way the accounts are operated. The only change is in the name.
Below are the top 1 Year FTD account rates – as of 21 May 2018:
|Institution||1 Year FTD Rate|
The bank currently offers four competitive Fixed-Term Deposit (FTD) accounts, ranging from one to five years, and three Notice Accounts, set at 31 days, 60 days and 120 days (scroll down for a table of the bank’s current rates).
Gatehouse Bank is a UK bank and its deposits are protected by the Financial Services Compensation Scheme (FSCS) up to £85,000 per person. The minimum initial deposit is £1,000.
Just as all banks generate returns for customer savings accounts by making loans and investments, Gatehouse Bank uses profit-generating Shariah-compliant investments, making its products popular with a range of investors.
Being Shariah-compliant means that the bank invests ethically. Gatehouse Bank does not invest customer deposits in gambling, alcohol, tobacco or arms companies. Examples of eligible investments include construction projects, property investments and sukuk (similar to bonds).
It also means that, instead of traditional interest rates, the bank offers an alternative known as the Expected Profit Rate (EPR).
Only in extreme circumstances would the rate change in the future but even in that event, the EPR would still be paid to that point. In the history of the Bank, its rates have never changed.
If a customer did not want the revised rate, they could withdraw their funds, including any profit, with no penalty.
Current Rates on all Gatehouse Bank’s Savings Products – as of 21 May 2018:
- 1 Year Fixed Term Deposit: 2.00% AER
- 2 Year Fixed Term Deposit: 2.05% AER
- 3 Year Fixed Term Deposit: 2.21% AER
- 5 Year Fixed Term Deposit: 2.45% AER
- 31 Day Notice: 1.05% AER
- 60 Day Notice: 1.15% AER
- 120 Day Notice: 1.53% AER
Charles Haresnape, pictured, CEO, Gatehouse Bank, commented:
“We’re delighted to lead the pack when it comes to our one-year account, which is one of our most popular.
Interest rates may have been left at 0.5% by the Bank of England this month but we are going to continue pushing to lead the way when it comes to delivering better returns for savers.
Easy access accounts are still often paying noticeably less than the Bank of England base rate, so a rate of 2.00% on a one year fixed-term deposit account certainly gives people something to think about.
It also feels like the right time to bring all our accounts back under the Gatehouse Bank umbrella so it becomes the bank’s name that is synonymous with them.
Customers are starting to realise the benefits of ethically based savings that also offer fantastic rates of return and access to the FSCS deposit protection scheme.”