Interactive investor, the UK’s second-largest DIY platform, will increase the rate of interest paid on customer cash balances in their ISAs, SIPPs, and trading accounts from 1 September 2023.
Cash balances in interactive investor’s SIPP will receive an interest boost of 0.50%. The interest rate on the first £10,000 will increase to 2.75% (up from 2.25%), while the rate of 3.50% will be paid on the value between £10,000.01 and £100,000 (up from 3.00%). Interest paid on the balance above £100,000, a tier recently introduced in July, will be boosted to 4.00% (up from 3.50%).
From 1 September, for the first time, interactive investor will also pay interest on euro balances in SIPPs, which will attract a rate of 2.75% for all value ranges.
For ii’s ISA, Junior ISA, and trading accounts, cash balances will receive 1.75% interest on the first £10,000 (up from the current 1.50%), 2.75% on the value between £10,000.01 and £100,000 (up from 2.50%), with 3.75% paid on the value over £100,000 (up from 3.50%).
All the new rates are based on British pounds, or the equivalent value in US dollars, unless stated otherwise.
Interest is applied at account level. Cash balances held in ISAs and JISAs, trading accounts, and SIPPs are treated separately.
Richard Wilson, CEO, interactive investor, says: “Following the most recent base rate rise, we are raising the interest we pay on our customers’ cash balances. This reflects ii’s relentless drive to provide excellent value for our customers. After all, we are fundamentally an investment platform but there are many sound reasons why customers may choose to maintain cash balances on investment platforms in the short term.
“We are living in extraordinary times, and people can have their own set of circumstances. Ultimately, we are all about giving customers choice and unrivalled value, so we also believe it’s important to pay customers who hold cash a healthy interest rate, and to pass on increases as base rates rise.
“And as we continue to innovate at ii, our recent pricing changes, which also come in from the start of September, will make our fair flat-fee structure more attractive to an even broader range of investors.”
Note: more information on ii’s repricing can be found here.
*AER stands for Annual Equivalent Rate and shows the interest rate received over the year taking into account the effect of compounding interest payments.
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