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Platforms boost cash Isa rates following Budget overhaul

Platforms have responded to Budget changes to the Isa regime by improving rates on cash and introducing new cash savings products.

In the Budget, the Isa limit increased to £15,000 and restrictions on moving between cash and stocks and shares Isas have been removed from 1 July.

FCA rules published last month bar platforms from offering unbreakable term deposits of more than 30 days. 

Ascentric says to offer fixed-term deposits paying up to 2.82 per cent in an Isa wrapper.

Some platforms are also offering improved rates on cash. Skandia has upped its rate from 0.1 per cent to 0.4 per cent in the wake of the Budget while Axa will pay 0.65 per cent on cash, up from 0.58 per cent.

Aegon will continue to pay 0.1 per cent below Bank of England base rate but has removed the 20 per cent charge currently levied on cash held in a stocks and shares Isa. Nucleus says from 1 July it will boost the rate it pays on cash from its current 0.52 per cent which is calculated quarterly. In addition, Zurich says it will add funds from the IMA Money and Short Term Money sectors to its platform this week.

Axa and Aegon also say they will make cash funds currently available within other wrappers accessible through an Isa.

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