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Do you know where your savings are really held?
Investment and money apps offer top instant-access and cash Isa rates
Some of the most competitive savings rates on the market – up to 4.85% AER – come from brands like Chip and Moneybox. But while these deals are attractive, these providers aren’t actually banks.
Many describe themselves as investment or money-management apps that partner with other banks to store your cash, including big high street names such as Barclays and HSBC.
But does this matter, and is it anything to worry about? Here, Which? takes a closer look at how accounts with these providers work and explains how safe your money is.
Who's behind the top savings deals?
Some of the providers offering savings accounts today aren’t banks, but apps and platforms that offer these accounts alongside other financial services. It’s important to understand how they work — and how your money is protected.
These firms don’t offer traditional banking services such as current accounts and debit cards. Instead, savings and Isa accounts are offered alongside a wider range of financial products, including investments and even mortgages.
Unfortunately, there is no catch-all name for these providers. Chip, for example, markets itself as a 'wealth app', while Moneybox and Plum say they are investment apps. But if you were to look them up on the Financial Conduct Authority (FCA) register, they are all listed as 'payment service providers'.
What they do share in common is the way they operate. These firms are authorised to hold and move money, but they don’t have a UK banking licence and must meet safeguarding requirements designed to protect customer funds.
This involves keeping your money separate from the firm’s own finances. For example, by placing deposits in a separate account with a regulated bank, holding it in low-risk investments, or protecting it through insurance or a similar guarantee.
- Find out more: best savings rates 2025
How do rates compare?
Investment or money-management app products currently dominate the savings market.
This table compares the best instant-access savings and cash Isa accounts, including money apps and banks. Results exclude products that impose restrictions on opening or withdrawals and are ordered by rate.
| Instant-access savings account | AER | Instant-access cash Isa | AER |
|---|---|---|---|
| Cahoot Sunny Day Saver | 5% | Moneybox Open Access Cash Isa | 4.85% |
| Sidekick High Yield Cash Reserve | 4.51% | Chip Cash Isa | 4.85% |
| Kent Reliance Easy Access Account | 4.46% | Tembo Cash Isa | 4.8% |
| Cahoot Simple Saver | 4.41% | Vida Savings Easy Access Isa | 4.55% |
| Dudley Building Society Easy Access Saver Online | 4.4% | Trading 212 Cash Isa | 4.5% |
Source: Moneyfacts. Correct as of 20 May 2025, but rates are subject to change.
Investment app Sidekick offers the second best instant-access rate and all but one of the top five cash Isa deals are from these apps.
Investment platform Moneybox, investment and savings app Chip, and mortgage broker app Tembo Money offer the best three cash Isa rates. A cash Isa from Trading 212, another investment app, is at number five.
Rates are currently highest for instant-access cash Isas, which allow you to save up to £20,000 a year tax-free. If you are willing to restrict yourself to three withdrawals a year, then you could get as much as 5.71% AER with Moneybox's limited access cash Isa.
Plum is another investment app that offers a top cash Isa rate of 4.85% AER. Again, you'll need to be happy to stick to three withdrawals a year.
- Find out more: best savings accounts
How safe are your savings?
These apps are authorised and regulated by the Financial Conduct Authority (FCA). They use partner banks to hold your money because FCA rules require them to keep customer cash separate from their own funds and ring-fenced, so they cannot use them whatsoever.
So long as these third-party banks are covered by the Financial Services Compensation Scheme (FSCS), your savings should benefit from the same protections as if you deposited your money directly into any UK bank. This means you can claim up to £85,000 for any shortfall in funds should the bank go bust.
That £85,000 is per person, per bank. But a word of warning: if you already have a large sum invested in one of these partner banks separately and the app provider also puts a chunk of your savings into the same bank, you could potentially go over the £85,000 limit, and some of your money could end up unprotected.
It's also important to be aware that savings are held in partner bank accounts using the provider's name rather than the customers'. Trading 212's terms and conditions, for example, state that funds are placed in a 'client money account'.
Trading 212 told Which? that the practice is a legal requirement for firms without a UK banking licence and said that the bank still recognises the money as the sole property of the individual customer.
However, the downside is that if the partner bank fails, the provider would need to make an FSCS claim on your behalf. This process could take longer to settle than if you held an account directly with the bank. You may also be liable to pay any administrative costs.
- Find out more: Financial Services Compensation Scheme explained
Where your money is held
Which? contacted the providers mentioned in our analysis and they all confirmed that because they partner with banks covered by the FSCS, customers' savings are protected. Here's where your cash is held:
- Moneybox: cash Isa funds are spread across 10 banks, including HSBC, Santander and Barclays.
- Trading 212: cash is held in JP Morgan Chase, Barclays, NatWest, Lloyds Bank and Bank of New York Mellon.
- Tembo Money: the app partners with Barclays, Bank of Scotland, Aldermore Bank and Shawbrook Bank.
- Chip: savings are 'powered by' ClearBank
- Plum: funds are held in Citi Bank.
- Sidekick: easy access savings are placed in OakNorth Bank.
What the FSCS told us
The provider's partner banks should be covered by FSCS protection, but the compensation scheme told Which? that protection depends on 'contractual arrangements'.
Customers shopping around for a savings account are unlikely to have access to that kind of information, so we asked the FSCS for a clear example of how the wording of a contract between a provider and a partner bank could leave customer funds vulnerable.
They told us that it differs from firm to firm and they are unable to provide information on how their protection would apply for specific providers.
Even the FSCS's own online protection checker is unable to help savers looking for quick answers. If you search for one of the savings providers examined in this article, you'll be told that all of your money is at risk.
As many of these providers currently offer top rates for savings accounts and cash Isas – and claim those funds are indeed protected by the FSCS – we asked the FSCS whether they have any plans to update their online tool with clearer information for customers interested in opening an account with one of these apps.
They replied that savers should ask providers directly what protections are in place in relation to their money if they are ever unclear.
What to check before you open
Unfortunately, the onus appears to be on the consumer to do most of the legwork when it comes to checking how protected their savings are. With this in mind, here a couple of steps you can take to ensure your money is safe:
1. Read the small print
If you're unsure whether the provider you are opening an account with is a bank or another type of provider, check the terms and conditions.
The company should explain how it operates on the product website. Chip, for example, has a section which provides details on how your money is protected and a link to a fuller explanation. Moneybox also has a section about FSCS protection.
2. Ask questions
If you are unsure about your nest egg's safety, the FSCS suggests asking providers the following questions:
- Which partner firm is my money held with?
- Does the partner firm my money is held with have a UK banking licence?
- Is my money passed on to the partner firm directly or will it be held by you for any length of time?
- How is my money protected if the partner firm my money is held with goes out of business?
- Will I be able to access or transfer my money if the partner firm my money is held with goes out of business?
- How long would it take to access or transfer my money if the partner firm my money is held with goes out of business?
- How is my money protected if you go out of business?
- Will I be able to access or transfer my money if you go out of business?
- How long would it take to access or transfer my money if you go out of business?
3. Check who owns who
Banks sometimes merge and that can have a significant impact on the protection of your savings.
Moneyfacts has a useful guide showing which savings providers are owned by whom.
What else should you consider?
Use our guides to finding the best savings account and best Isa account to help make a more informed decision.
In 2024, we asked 4,524 members of the public to rate their bank or building society. Based on those results, we created a customer score for each savings provider.
We've also analysed thousands of savings products and given each provider an overall product score, highlighting which companies offer consistently competitive rates.
- Find out more: Which? Recommended Providers for savings
