Coventry Building Society has launched a new easy access Isa with a market-leading interest rate ahead of the new tax year.
Its new Easy Access Isa (Online) offers a rate of 1.50%, equalling the top rate from Santander.
The Santander rate is only available to 123 World and Select customers whereas the Coventry's product is open to all.
However, the Coventry's Isa comes with a fixed bonus of 0.35% tax-free which is paid until 31 July 2020. After this the rate will drop to 1.15%.
The account can be opened online with a minimum initial investment of £1. Transfers for the current and previous years’ Isa savings are accepted and savers can make unlimited online withdrawals without notice or charge.
Matthew Carter, head of product at Coventry Building Society, says: “The end of the tax year is fast approaching and our new Easy Access Isa (Online) is a fantastic option for savers looking to take advantage of their annual Isa allowance.
“With a market-leading rate and the flexibility of unlimited online withdrawals, our new Isa could help savers to make the most of their current, future and previous years’ Isa funds.”
It matches the rate of Santander’s 1|2|3 eISA (Issue 5), which also has a rate of 1.50% and can be opened online for £1.
The rate also includes a 0.35% bonus which is paid on 21 July 2020.
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Just below this, OakNorth and Virgin Money are both offering a rate of 1.45%.
The OakNorth account needs a minimum initial investment of £1,000.
You can open the Virgin Isa online for a minimum of £1, however, you are restricted to just two withdrawals a year.
Better rates are available if you are prepared to lock your money away in a long-term fixed rate Isa.
Currently, the best rate out there is from Coventry Building Society at 2.30%.
This is a fixed-term deal that ends on 30 November 2023 and the account can be managed, online, in-branch or by telephone with a minimum deposit of £1. Choosing to access the funds before the fixed-rate period is over will result in closure of the account and a 180-day loss of interest.
The next best rate is from Principality Building Society at 2.13%, but you will have to lock your money away for five years. The account can be managed online and you can open it with an initial deposit of £500. Accessing the savings early will result in closure of the account and 360 days’ loss of interest.
Anna Bowes, co-founder of savings advice site Savings Champion, says: “Hot on the heels of the launch of Santander’s 1|2|3 eISA (Issue 5), it’s encouraging to see another big provider offering a market-leading easy access Cash Isa.
"Hopefully, this will drive even more competition in the best buy tables - which will be great news for savers.
“As the name suggests, the Coventry Easy Access ISA (Online) is only available to those who are happy to open and manage their savings online, but what is really good news about the best easy access Cash Isa rates that are currently on offer is that they are equal or a similar to the best non-Cash Isa easy access accounts.
"This means that all savers can once again consider using their Cash Isa allowance, not just those who have used up their Personal Savings Allowance or are close to using it all.”
This article was originally published in our sister magazine Moneywise, which ceased publication in August 2020.
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