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Savers put cash into ISAs despite low rate
HARD-PRESSED savers are continuing to put their cash on deposit at banks, despite falls in interest rates, Bank of England figures showed yesterday.
The change in the ISA rules is behind the change, the Bank believes, with savers able to put up to £15,000 in the tax-free accounts, across cash and the stocks and shares products from July.
A balance of 29.3 per cent of banks reported retail deposits rising in the second quarter despite low interest rates. And even more – a net balance of 39.1 per cent – expect savings volumes to rise in the third quarter.
That comes despite rates falling again – a net balance of 17.5 per cent of banks expect rates on deposits to fall closer to the 0.5 per cent base rate in the coming quarter.