The best easy access Cash ISA is now offering a leading 4.63% interest rate, according to savings experts at Moneyfacts. The rate increase, driven by competition between fintech platforms Trading 212 and Plum, provides savers with an opportunity to maximise tax-free returns on their money.
Trading 212 Leads the Market
Trading 212's Cash ISA promo rate, paid monthly, is available online or via the firm's mobile app. Savers can open an account with a minimum deposit of just £1 and make withdrawals or additional deposits without restrictions or penalties. As a flexible ISA, any funds withdrawn and replaced within the same tax year do not affect the ISA allowance.
Finance expert Rachel Springall from Moneyfacts described the news as encouraging for savers. Moneyfacts ranked Trading 212's product as the leading easy access ISA rate in its weekly top ISAs list. The product is also listed as the top for new money by Martin Lewis's Money Saving Expert, while Chip's offering is hailed as the best for transfers.
Plum and Chip Offer Competitive Alternatives
Plum offers a slightly lower rate of 4.62% AER monthly, including a 12-month bonus of 2.08% AER. However, this headline rate is only available to new customers; savers transferring in from another ISA receive a lower 4.00% AER, including a 1.46% bonus for 12 months. Plum's ISA is app-only, with a minimum deposit of £1 and flexible ISA rules, but no interest is paid if the account is closed or a transfer is requested during the month.
Chip continues to pay 4.42% AER on its Chip Smart Cash ISA, including a 12-month bonus of 0.65%. This app-only ISA pays interest monthly on a minimum deposit of £1, follows flexible rules, and allows unrestricted deposits and withdrawals. However, savers who close the account or request a transfer out will not be paid interest for that month.
Important Considerations for Savers
Moneyfacts warns savers to check the providers' partner banks to ensure their money is fully covered by the Financial Services Compensation Scheme (FSCS), which pays compensation up to £120,000 if the financial firm holding the savings or current account goes bust. Rachel Springall added that while the rates are attractive, savers should consider the terms and conditions, including any bonus rates that may expire after 12 months.
