18 Month Fixed Rate Business Bonds

Note

Eligible deposits with UK institutions are protected by the Financial Services Compensation Scheme up to a maximum level of protection of £85,000 per business per institution. The deposits of most non-financial services businesses are covered up to the £85,000 limit.

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18-month business bonds explained

Is fixing for 18 months a good idea?

If you’ve got a lump sum of money you won’t need to access for 18 months, then yes, 18-month business bonds can be a great idea for your business. Fixing for this length of time means you can maximise the amount of interest earned without needing to tie up your money for several years, and because it’s a fixed rate, you know exactly what you’ll be left with at the end of the term.

Not only that, but 18-month business savings bonds often boast higher fixed rates than their long-term counterparts. Of course, there’s no guarantee that rates will remain at this level, so if you’d like longer-term security, opting for a two-, three- or even five-year business bond could always be considered.

Can I withdraw my savings during the term?

No. Your business savings will need to remain untouched in the account for the full 18-month term, so you’ll need to be confident you won’t need to access it during this time. Bear in mind too that you’ll normally need to deposit a large sum of money in order to secure the best deals, with some expecting minimum deposits of as much as £50,000.

Can the interest rate change during the term?

No. Once set, the interest rate is fixed until maturity, no matter what happens to rates elsewhere in the market. This is why it’s so important to compare rates thoroughly, so you know you’ll be earning interest at the highest rate possible. Note that interest is typically paid either on maturity or yearly, though some accounts will have other options.

Which bank offers the best rate?

This can vary a lot, with banks and building societies continually amending their rates. This means it’s essential to stay up-to-date, and our charts of the best 18-month business bonds in the UK would be a great place to start. You’ll be able to find deals from well-known names including Lloyds Bank and Bank of Scotland, as well as more niche providers such as Unity Trust Bank, which typically offer the best rates.

Make sure to consider the account opening and management options before making your decision as well. Some providers of business savings bonds still expect the account to be operated in branch or by post, so always factor this in to determine whether or not it’s feasible. If not, you may be better looking at some of the best digital banks instead.