Tembo launches best-buy fixed cash Isa - how does it compare to other savings accounts?
The cash Isa pays interest of 4.27 per cent and is offered through the investing platform Investec.
The new launch has propelled Tembo to the top of the best buy savings tables, and it now offers the best rate for a one-year fixed-rate cash Isa on the market.
The Isa can be opened with a deposit starting from £500 by downloading Tembo's app.
Savers should make sure they are happy locking their cash away for one year, and only put in money they definitely won't need to access in that time.
A saver keeping £10,000 in this Isa would earn around £435 after the one-year term, according to This is Money's savings calculator.
Richard Dana, founder and CEO of Tembo said: 'With rates coming down, many of our customers have been asking us to offer a fixed-rate product.'
It is the latest addition to Tembo's Isa range having launched an easy-access cash Isa in January. Its current version of this account pays 4.64 per cent.
How does it compare to other Isas?
The best one-year fixed-rate Isas currently offer around 4.2 per cent.
After Tembo, Kent Reliance offers the next best cash Isa, paying 4.25 per cent, while Vida savings and Vanquis Bank also offer this rate. Savers stashing £10,000 in these accounts would earn around £433 after the year term is up.
Tembo's fixed-rate Isa is unusual in that, unlike most fixed-rate Isas, you can make further one-off deposits into the account after you've opened it. Most fixed-rate Isas do not permit additional deposits once the account is open.
New funds added to this Isa after the initial deposit will be locked in for 12 months from the date they're added, at the rate available at the time.
This rate may be different from the 4.27 per cent rate the initial deposit locked in at when you first opened the account.
What's in the fine print?
Tembo is a mortgage and savings platform which launched in October 2020. It was set up with the aim of helping first-time buyers to get on the housing ladder more easily by brokering a small interest-only mortgage on their parents' - or another family member or friend's - home.
It has now branched out into savings and offers Isas through banks it partners with, for example Investec in the case of the one-year fixed-rate Isa.
Money held in the Tembo Isa is fully protected by the Financial Services Compensation Scheme (FSCS) up to £85,000 per eligible person, per bank.
Funds in the Tembo Isa are held in partner bank accounts including Barclays, Bank of Scotland, Aldermore Bank and Shawbrook Bank.
It is worth noting that the £85,000 limit applies to the total amount of money you hold at any one bank, whether it is deposited by Tembo, by other providers, or by you directly with the bank.
If you have a Barclays current account, for example, the funds held in this account will take up part of your £85,000 claim limit for Barclays alongside any funds held by Barclays on Tembo's behalf.
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