Monmouthshire Building Society has launched a one-year fixed rate Cash ISA with a “competitive” 4% tax-free interest rate. If a saver deposits the maximum annual balance of £20,000, they would receive a healthy £20,800 by the end of the term.
Eleanor Crees, senior product manager at Monmouthshire Building Society, highlighted that this will be the last time most savers can earn tax-free interest on balances up to £20,000. She said: “In the Autumn budget, it was announced that from April 2027, you will only be able to save up to £12,000 a year into a Cash ISA if you are under 65 years of age. Therefore, the 2026/27 tax year will be the last chance that those under 65 will have to save up to £20,000 in a Cash ISA.”
The minimum balance for Monmouthshire’s ISA is £1,000, and the account has to be opened through the mutual’s app for new ISA funds. Money can be deposited into the account within the first 30 days of opening, up to a maximum balance of £20,000.
Ms Crees added: “We are really proud to be bringing this app-only ISA product to the market, and with such a competitive interest rate.
“Thanks to our app, customers can control their finances from the palm of their hand, but once opened, they can also pop into our branches and hubs to manage their investments.”
Because it is a one-year fixed-rate ISA, no withdrawals can be made from the account until the end of the fixed term. If a withdrawal is made earlier, a charge equivalent to 90 days’ loss of interest will be applied to the final balance.
Other banks are offering similarly high rates to Monmouthshire Building Society, with one account paying up to 4.2% in tax-free interest.
Isbank Meteor Savings is currently offering a 4.2% rate on its One Year Fixed Rate Cash ISA. No withdrawals are allowed, and savers will not receive any interest if they access their money early, so it is best for savers who can afford to put away their money for the term. The minimum opening balance is £1,000, and interest is paid on maturity.
Chetwood Bank is offering 4.16% AER on its Hargreaves Lansdown Active Savings – 1 Year Fixed Rate Cash ISA. Savers can access their money early, but they would lose 90 days’ worth of interest. The minimum opening amount is also £1,000, and interest is also paid on maturity.
Close Brothers Savings 1 Year Fixed Rate Cash ISA is paying out 4.11% AER. However, this is aimed at savers who can put away large sums of cash, with a minimum opening balance of £10,000. Savers can deposit more money within the first 10 days of the account opening, but early access would result in the saver losing 90 days’ worth of interest. Interest is paid annually.