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Cash ISA rates recover from record lows

Written by: Emma Lunn
Cash ISA rates have risen across the board with product choice also improving, according to Moneyfacts.

Moneyfacts’ UK Savings Trends Treasury Report data found that average ISA rates rose across the board month-on-month in November, with all average ISA rates moving away from record lows.

The average easy access ISA rate rose to its highest level during 2021, to 0.19%. The average notice rate rose for the seventh month running, now 0.55%, its highest point since June 2020 when it was 0.69%.

November has also seen more choice of ISAs, with 382 products to choose from, the highest seen since March 2020 when there were 417 deals.

The average one-year bond now pays 0.77%, compared to 0.61% a year ago. The average longer-term bond pays 1.06%, compared to 0.87% this time last year.

Rachel Springall, finance expert at Moneyfacts, said: “Savers may well have been disappointed that the Bank of England did not increase interest rates this month, but regardless, the savings market has been moving in a positive direction. One area of the savings arena to make a comeback from record low rates has been Cash ISAs, as with the notice ISA rate rising month-on-month, no longer is there an average savings rate resting at a record low. There does however remain a difference between the top fixed ISA and non-ISA rates so savers will need to think carefully which is the most suitable for their needs.

“Fixed bond rates continue to rise, thanks to a healthy injection of competition among challenger banks, which means both the average one-year fixed and longer-term fixed rate bond has risen for seven consecutive months. Savers coming off a one-year fixed deal will be pleased to see the average one-year bond stands at 0.77%, up from 0.61% a year ago. While much of the rate focus has been within this arena, there has also been an uplift to longer-term fixed rates, with the average longer-term fixed rate bond of 1.06% now at its highest level since May 2020.”

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