An Post has announced interest rates at the bottom end of the range for accounts under the Government Special Savings Incentive Scheme.

Both its fixed and variable rate deposit options will offer 4 per cent and the rate will not fall more than one percentage point below the European Central Bank rate on the variable option over the five-year savings term. The ECB rate is currently 4.75 per cent.

Mr Eamonn Ryan, managing director, Post Offices, said: "These products offer a competitive rate of return with no charges." While the terms of An Post's variable product match those of the two big banks, they are not as attractive as those offered by several other institutions.

In its favour, An Post will not penalise people switching out of its fixed-rate fund.

Consumer Association of Ireland director Mr Eddie Hobbs described the An Post product range as "a pretty limp offering". Mr Dermot O'Brien, of National Deposit Brokers, said people should compare rates before investing their funds. A spokesman for An Post said the accounts would attract no charges, came with a State guarantee and were accessible through any of the 1,000 post offices nationwide.