Lower rates in 1 year than Rolling

I don't think RS need to "deal with low rates".  Borrowers want the lowest rates they can get, and RS will maximise their profits if they can maximise the spread between what borrowers are willing to pay and what lenders demand.  You don't see the spread, because it is deducted from the borrower rates displayed.  The lower those rates, the happier RS will be - if they can get a match.

The rolling market is entirely artificial, being used to fund loans of between 6 months and 5 years.  The one year market is somewhat more genuine, being used to fund loans of up to one year www.ratesetter.com/invest/everyday-account.  However, for loans of 6-12 months, RS could fund on either the one year market or the rolling market.  I'm sure they will have an algorithm to make that decision for them, with the aim of maximising their profit subject to liquidity constraints.  Just at the moment, those 6-12 month loans are probably being placed on the 1 year market but this won't always be the case.

As to why lenders are willing to lend at lower rates on 1 year than rolling, some of it will be autolenders who don't check their settings very often if at all.  Beyond that I've no idea.

[Edit: Crossed with previous post.]

I think RS upload the borrowers in the rolling market around midnight where as all the other markets aren't loaded until later in the day -(I maybe wrong) which is why we see what we see.
I believe the lenders set the rates on the lending markets.
So I guess - Someone has probably set their reinvestment at (in this example) 3.3% , so as soon as their money is available to lend its goes onto the market at the set rate.  There is an option on RS to have it at 'market rate' so all the users who have this 'ticked' the RS computer will build the reinvestment market at the current levels. In this case around 3.5% in the 1 year - Hence lowering the rates.
Obviously the reverse is applicable.
Personally I have my reinvestment set at 4.5% - However, when my money goes to market, if I get time, I try to look at the supply/demand on the day and move it accordingly. The last few weeks I'm getting closer to a 5% match in the rolling and 5.5 % in the 1 year

£17k of 6.0% left in one year if you're very very quick. Not quite midday oldgrumpy

Can someone explain how to get "Rolling" money transferred to "Holding Account" to take advantage of those good 1 year rates - without surrender penalties. I too got 6% but with new money although I had "Rolling" money.

IIRC there is at least a 24 hour lock-in on rolling contracts (before you can sell them out) and sell-out was not exactly instant .. you can of course cancel any offers that are sitting around unmatched. Personally I think 'reach for the debit card' is probably more sensible, and extract the required funds later (but when chasing these rate spikes you always have to remember the borrower may 'repay' or 'cancel' pretty much the next day .. on any/all products).