THE number of accounts offering returns of more than 4% has soared 25-fold during the past two months, as competition in the savings market increases, research showed today.

There are now 75 different fixed rate bonds paying interest of at least 4%, compared with just three at the beginning of March, according to financial information group Moneyfacts.co.uk

The increase has come despite the Bank of England base rate being cut by a further 0.5% during the period, to a new record low of 0.5%.

Competition in the fixed-rate savings market has intensified in recent weeks, with a range of providers launching new 4%-plus accounts, including major players such as Alliance & Leicester, Halifax and ICICI Bank, as well as a number of smaller building societies.

Saga has become the latest group to offer one of the deals, launching a four-year fixed rate account paying 4.35% and a two-year one at 4.15%.

The four-year deal put it in third place in the best buy tables, behind bonds paying 4.4% being offered by both Halifax and ICICI Bank. But returns on variable rate accounts remain low.