After years in the doldrums, cash ISA rates are rising rapidly thanks to rapid increases in the bank rate which rose to 4% last week.
The average easy access ISA rate has risen from 0.26% in February 2022 to 1.85% this month, according to data provider Moneyfacts.
While cash ISA rates have risen they are still well below CPI inflation which remains over 10%.
Moneyfacts says cash ISA rates have risen “substantially” over the past 12 months.
- Top ISA rates have risen considerably over the past 12 months, across easy access, notice, one-year and five-year fixed terms
- Non-ISA rates are also on the rise for savers who use their their Personal Savings Allowance (PSA)
- Those who locked into the top one-year fixed rate ISA a year ago will find the equivalent top deal now pays more than four times the amount of interest
- The top rate on a five-year fixed ISA pays almost twice the rate than the equivalent deal in February 2018
Savings market analysis – average rates and top rates | |||
Average savings rates | Feb-18 | Feb-22 | Feb-23 |
Easy access ISA | 0.78% | 0.26% | 1.85% |
Easy access (non-ISA) | 0.48% | 0.21% | 1.73% |
Notice ISA | 0.96% | 0.37% | 2.57% |
Notice account (non-ISA) | 0.79% | 0.53% | 2.55% |
One-year fixed rate ISA | 1.12% | 0.60% | 3.41% |
One-year fixed rate bond | 1.19% | 0.84% | 3.61% |
Five-year fixed rate ISA | 1.85% | 1.40% | 3.68% |
Five-year fixed rate bond | 1.97% | 1.51% | 4.04% |
Average rates (gross) based on a £10,000 deposit on a 1st of month basis. | |||
Top rates | Feb-18 | Feb-22 | 06-Feb-23 |
Easy access ISA | Virgin Money – 1.21% | Shawbrook Bank – 0.61% | Newcastle BS – 3.05% |
Easy access (non-ISA) | RCI Bank UK – 1.30% | Investec Bank plc – 0.71% | Newcastle BS – 3.05% |
Notice ISA | Marsden BS (120 day) – 1.30% | Aldermore (30 day) – 0.55% | Loughborough BS (120 day) – 3.05% |
Notice account (non-ISA) | Secure Trust Bank (180 day) – 1.65% | Shawbrook Bank (120 day) – 1.08% | Furness BS (120 day) – 3.50% |
One-year fixed rate ISA | Leeds BS – 1.45% | Coventry BS – 1.00% | Virgin Money – 4.25% |
One-year fixed rate bond | Atom Bank – 1.95% | Union Bank of India (UK) Ltd – 1.40% (payable on maturity) | SmartSave – 4.17% |
Five-year fixed rate ISA | United Bank UK* – 2.24% (payable on maturity) | UBL UK – 1.82% (payable on maturity) | UBL UK – 4.46% (payable on maturity) |
Five-year fixed rate bond | Secure Trust Bank – 2.43% | UBL UK – 2.19% (payable on maturity) | UBL UK – 4.63% (payable on maturity) |
Top rates (gross) based on a £10,000 deposit, on a 1st of month basis unless specified, for new customers. Higher rates may be available for other levels of deposit. *Now UBL UK. Source: Moneyfacts.co.uk | |||
Rachel Springall, finance expert at Moneyfacts.co.uk, said: “Consumers who prefer a longer-term fixed ISA will be pleased to see much higher rates when they come off their current deal this year, as the top rate on a five-year fixed ISA is over 2% higher than the equivalent deal in 2018.”