Hodge Bank has boosted the interest rate on its two-year fixed savings account to 4.6%, earning an “excellent” Moneyfactscompare rating.

Savers need a minimum deposit of £1,000 to get started and up to £1million can be invested overall.

Fixed-rate accounts enable savers to lock their money away for a set period at a fixed interest rate. They’re best for those who can afford to leave their money untouched for a specific term and want guaranteed returns. These accounts often also offer the highest rates of interest.

Commenting on Hodge Bank’s deal, Caitlyn Eastell, spokesperson at Moneyfactscompare.co.uk, said: “This week, Hodge Bank has increased the rate on its Two Year Fixed Rate Bond, paying a highly competitive rate for its term.

“The account now pays 4.60% gross/AER on anniversary or 4.51% gross/4.60% AER monthly for savers wishing to boost their income.”

Ms Eastell noted that the account may be a “good option” for investors looking for a guaranteed return on their deposits, however, she warned: “They must be comfortable with locking away their investments as early access is not permitted.

“They may be glad to see that they can make further additions up to 14 days from the account opening.

“Overall, the deal earns an Excellent Moneyfacts product rating.”

While Hodge Bank may be offering a highly competitive rate, it isn’t quite topping the market. SmartSave places just ahead with an Annual Equivalent Rate (AER) of 4.62%.

Savers need a larger deposit of £10,000 to get started, and up to £85,000 can be invested overall.

Interest is paid on maturity and like with most fixed rate savings accounts, withdrawals cannot be made until the term ends.