Another option is to deposit money in “active savings” accounts, where your cash is automatically transferred to the accounts paying the most when they appear on the market. Stock brokers Hargreaves Lansdown and AJ Bell both offer these services.

They make money by taking a commission from the providers they partner with and the customer does not pay a fee. The downside is that some of the best deals may not be covered by the service. 

Who will raise rates first?

Lesser-known banks will pass on rate rises to customers fastest, as they compete to raise deposits, experts said. Building societies will also be faster than high-street banks.

Recognise Bank has become the first to announce it will pass on the full increase to customers with variable-rate accounts from next week. The increase will apply to its “95 day notice accounts”, which will now pay out up to 1.5pc, as long as customers provide sufficient notice before taking out any funds. 

Rachel Springall of data firm Moneyfacts said: “Speed is of the essence when it comes to grabbing a top rate deal, as there is no guarantee they will sit on the shelf for long. “Shopping around is essential and even if a brand is unfamiliar, so long as they have the same protections in place as a high street bank, there is little reason to overlook them.”

Some of the first challenger banks to improve deals after the December rate rise included Metro Bank, Atom Bank and Tesco Bank. Building Societies that increased the interest they pay this month include Nationwide, Darlington, Tipton and Coseley, Stafford, Principality and Cumberland.

What else can I do?

Investing in the stock market is one of the best ways to protect against rising interest rates and inflation as companies can pass higher costs onto consumers. 

Firms with strong pricing power and high profit margins, such as luxury goods or software brands that provide essential tools, will not be too badly affected by rising prices. Fundsmith Equity, the £26bn flagship strategy managed by star manager Terry Smith, has large positions include Microsoft and L’Oréal, the luxury cosmetics company.

Another popular fund is the £1.2bn Morgan Stanley Global Brands fund, which buys companies with loyal customers that will be willing to pay more for goods and services.