Cash ISAs: The Best Currently Available List

pecunianonolet

Zopa Smart ISA - now top of the table at Moneyfacts.

"We're offering new Smart ISA customers a 3-month fixed bonus rate of 1.21% AER* on top of the underlying 3.80% AER* (3.73% gross**) variable Access ISA pot rate.

This means you'll earn a total of 5.01% AER* (4.89% gross**) variable on Access ISA pots for 3 months from the date you open a Smart ISA."

https://www.zopa.com/smart-isa



Not really competitive because the underlying rate is probably going down in a few days after an expected BOE rate reduction. Assuming a cut of 0.25% the new rate would be 4.76% for the remainder of those 3 months with a sharp cliff edge after. Unless someone is prepared to transfer again within a short while this doesn't look like a very attractive offer. If providers involved not backdate interest the loss through moving could actually be higher than leaving funds in a lower paying account. 

P.S. Trading212 also slightly increased their rate to 4.81% (4.76% previously) to appear above the 4.8% of Tembo

S_uk

pecunianonolet said:

Not really competitive because the underlying rate is probably going down in a few days after an expected BOE rate reduction. Assuming a cut of 0.25% the new rate would be 4.76% for the remainder of those 3 months

Is it actually expected that the BOE will cut the rate at its next meeting next week? Articles I've read about it seems to to suggest a likely hold, with the following meeting not until the second week of May. I'd also be surprised at them cutting consecutively after last month's cut given everything about global tariffs at the moment, plus inflation rising to 3% in the most recent data release.

pecunianonolet

S_uk said:

pecunianonolet said:

Not really competitive because the underlying rate is probably going down in a few days after an expected BOE rate reduction. Assuming a cut of 0.25% the new rate would be 4.76% for the remainder of those 3 months

Is it actually expected that the BOE will cut the rate at its next meeting next week? Articles I've read about it seems to to suggest a likely hold, with the following meeting not until the second week of May. I'd also be surprised at them cutting consecutively after last month's cut given everything about global tariffs at the moment, plus inflation rising to 3% in the most recent data release.

I expect this to happen and I might be wrong. As a saver I would welcome a hold or an increase of course, although unlikely.

It's not really an ISA topic but I expect this because:

- No growth in the economy and a softening labour market
- No room for manoeuvre by the government as borrowing is still very high 
- The NI increase as a domestic measure will lead to many companies getting in trouble or having to make further cuts, including staff. Together with hefty council tax, water, energy and the so many other increases there is even less disposable income for consumption by individuals. Sure, some will get a boost due to minimum wage rise, pensions, etc. but those who have to pay for it have to find this somewhere
- Foreign issues through tariffs will cost companies billions in trade too, potentially leading to more issues for companies and cuts in the labour market

In light of this and potential turbulences in financial markets if things should escalate the access to cheaper loans for companies and individuals alike will help to allow companies to adjust and invest. Lower interest rates also lower the burden of interest payments the government has to make to repay dead. As the housing market is a key driver for the British economy, lower rates help with mortgages and building new housing. It's also a seasonal thing that people tend to spend more when the days get longer and the sun is out more often, which will help small businesses, high streets, etc to absorb some of the pain.

An increase of spend for defence also has to be found somewhere and since there is nothing in the chancellors piggy bank, it means either further tax increases or to to push the pain further into the future. Tax rises bite immediately, the average Joe will notice straight away. The cost of borrowing today will be the problem of the next generation and is not immediately noticeable by the average Joe. However, extreme dead impacts the gilt market, which is crucial for our pensions.

The BOE just injected ca 2bn into domestic banks to keep them afloat and well prepared should things go south over night because of another TT (Trump Tantrum). 

https://www.reuters.com/markets/rates-bonds/bank-england-allots-most-money-since-2020-indexed-long-term-repo-2025-03-11/

You could of course argue that a hold is sensible to see how things turn out as it is all rather volatile at the moment and as you say inflation is still above target and could quickly get out of control again. CPI is 3% but CPIH is 3.9% and UKCIRUM is at 3.7%, mainly driven my service inflation. 

Last but not least, the BOE has information we don't have (yet). The BOE and OBR already know what the spring statement will include so they can anticipate market behaviour. 

Make of it what you want but I think a cut is likely, although as a saver I would welcome a hold :-)

friolento

Transfer from Moneybox to Tembo was completed within 2 working days. Impressive.

Moneybox informed me that I will be unable to open another ISA with them in the foreseeable, for technical reasons. Though they said they will let me know when they have upgraded their systems.

VNX

pecunianonolet said:

Zopa Smart ISA - now top of the table at Moneyfacts.

"We're offering new Smart ISA customers a 3-month fixed bonus rate of 1.21% AER* on top of the underlying 3.80% AER* (3.73% gross**) variable Access ISA pot rate.

This means you'll earn a total of 5.01% AER* (4.89% gross**) variable on Access ISA pots for 3 months from the date you open a Smart ISA."

https://www.zopa.com/smart-isa



Not really competitive because the underlying rate is probably going down in a few days after an expected BOE rate reduction. Assuming a cut of 0.25% the new rate would be 4.76% for the remainder of those 3 months with a sharp cliff edge after. Unless someone is prepared to transfer again within a short while this doesn't look like a very attractive offer. If providers involved not backdate interest the loss through moving could actually be higher than leaving funds in a lower paying account. 

P.S. Trading212 also slightly increased their rate to 4.81% (4.76% previously) to appear above the 4.8% of Tembo

Who knows but a base rate cut in March would be surprising 

slinger2

I've been getting a bonus of 0.5% from Zopa for last year (ends 6 April 2025) lifting my current interest rate to 4.30%AER (variable). This new 1.21% over 3 months for new customers doesn't seem very generous to me. Obviously that averages out at about 0.3% over a year. Unless Zopa extend the bonus period you'll probably have to transfer your ISA elsewhere after 3 months to get a good rate.

To me (as an existing user) their only ISA account that looks competitive going forward is the 4.40%AER 1 year fix. I've got an ISA maturing later this month, so it's decision time for me.

poppystar

Opened Cash ISA Online 1 with Leeds at 4.25% yesterday now it’s Online 2 at 4.41% as rates increased overnight. Thankfully they answered phone quickly and changed the product this afternoon. 

refluxer

Just a reminder for anyone considering opening a cash ISA with Zopa that they don't allow partial transfers out.

This won't affect anyone moving all of their easy access ISA cash from one provider to another but does have implications if you wanted to subsequently split that ISA cash or if you were to make use of their fixed ISA pots, as all pots are considered to be part of the same 'Smart ISA' which means that all of your ISA savings would need to remain with Zopa for the length of your longest fixed term in order to transfer out without cutting that term short and paying a penalty.

ToastLady

My Zopa EA ISA boost will drop around start of new tax year. Wondering if they will give another boost. If not, will be transferring out elsewhere. Will have a look in another week or two to see what options are available. 

Stompa

Well I just opened a Tembo Cash ISA, but attempting a deposit into it seems to just get you into an infinite loop, so I'm distinctly unimpressed so far.