Signs of life in the cash Isa market as rates perk up

SAVERS have been given a glimmer of hope with the launch of an easy-access cash Isa at 1.25 pc and an Isa draw with £500,000 in prizes to giveaway.

Until now, the so-called Isa season has met with a deafening silence. Some providers have cut rates or even withdrawn their top-paying accounts.

But two new accounts paying decent rates are out this week.

Coventry BS’s new Online Isa pays 1.25 pc. And from Friday, Nationwide is giving you the chance to win up to £20,000 if you top up your existing Isa with the building society or open a new one. You need to put in at least £100 between this Friday and April 30.

The draw will take place on May 21 with ten prizes of £20,000, ten of £10,000 and 40 of £5,000. It is open to all savers in England, Scotland and Wales.

Nationwide will offer a new version of its 1 Year Triple Access Online Isa at 1.21 pc from Friday. It limits you to making three withdrawals a year. The rate drops to 0.75 pc after 12 months, so you should look to move your money then.

The new Coventry account, with no withdrawal restrictions or short-term bonus, puts it near the top of the bestbuys tables. It’s an attractive return considering the average rate is just 0.56 pc, and some big banks, including Halifax and Lloyds, pay just 0.2 pc to new savers. It is only bettered by Cynergy Bank at 1.29 pc and Ford Money at 1.27 pc.

Virgin Money pays a slightly higher 1.31 pc on its Double Take E-Isa but it is only suitable for savers willing to limit any withdrawals to a maximum of two a year.

Money Mail does not include easyaccess accounts with withdrawal restrictions or short-term bonuses in our best-buys tables, but we do keep you informed of what is on offer.