The subscription-based investment platform said the 0.25% AER/gross interest will be paid on cash balances over £10,000 or the equivalent value over £10,000 held in US dollars.

This means that if investors have a £15,000 cash balance, perhaps waiting for a buying opportunity, the interest will only apply to the £5,000 – the amount above the £10,000 threshold.

It will apply to cash held in ISAs, trading accounts, SIPPs (Self-Invested Personal Pensions) and Junior ISAs. However, it applies to each account separately so even if you have more than £10,000 in cash spread across the accounts, you won’t get the interest. It has to be over £10,000 in a single account.

Interactive Investor said the move to offer interest on dollars comes as investors are increasingly looking overseas, and the US market is the second largest region for its customers investing directly in shares. It confirmed interest on dollar cash balances will be paid in dollars.

Richard Wilson, CEO of Interactive Investor, said: “Interest rates are still low, but following recent increases, II will begin paying interest on accounts from 1 July.

“We are a simple fixed-fee investment platform, always striving to enhance service and value. We continue to innovate – last year we introduced Friends and Family, and this year we have followed through with the launch of our fantastic value Pension Builder.

“With investors increasingly investing internationally, our customers who minimise FX costs by holding foreign currencies in their ii account don’t need to pay an FX commission each time they trade. Now they can potentially earn interest on US Dollar balances too.

“Customers looking for meaningful returns on cash, such as they are, may want to consider our cash savings service, with some market leading rates from the UK’s banks and building societies. And for anyone wanting to save money in investment platform costs, the best way to do so is to shop around. For larger pots, you could save a fortune by switching to a flat fee platform like II.”

Last month it was confirmed that Abrdn had completed its £1.49bn buyout of II which has 400,000 customers and approximately £59bn in assets under administration. It continues to operate as a standalone business and an independent brand.

II completed its acquisition of TD Direct Investing in 2017, Alliance Trust Savings in 2019, and Share plc in 2020. Its latest acquisition was the EQi book of customers in 2021.