Small banks launch Isa rates at last

NEW banks are finally launching tax-free cash Isas paying top rates.

Shawbrook Bank’s Easy Access Cash Isa pays 1.1 pc and OakNorth Bank’s new account 1.05 pc.

Post Office Online Isa now offers 1.07 pc. But this rate is boosted by a 0.82 percentage- point bonus which runs for a year. After that your rate drops to just 0.25 pc.

If you don’t want an online account, Sainsbury’s Bank pays 1.06 pc on its Cash Isa, and NS&I Direct Isa, which you can run over the phone, offers 1 pc. In the High Street, Newcastle BS pays 1 pc and Skipton BS 0.9 pc. Nationwide also pays 1 pc but only to those who have a current account with the society.

You get much less with big banks. NatWest pays 0.1 pc on up to £10,000, 0.25 pc up to £25,000 and 0.5 pc up to £50,000. Lloyds Cash Isa Saver and Halifax Isa Saver Variable pay 0.35 pc for the first 12 months then 0.2 pc.

The rate on Barclays Instant Cash Isa is 0.55 pc up to £30,000, then 0.65 pc up to £100,000.

At HSBC, the standard rate is 0.45 pc although Premier current account holders earn 0.75 pc if they add to their savings each year.

You can transfer your Isa money out of the big banks to a better deal. Among the top payers, only NS&I refuses to take these transfers.

Approach your new provider and ask it to arrange the switch.