The three-year flexible cash Isa issue one, gives customers a fixed rate of interest throughout the term and the chance to make three withdrawals each up to 10 per cent of the current balance.
There are no withdrawal charges and no notice required. It also allows continuing customer subscription up to annual cash allowances up until 5 April 2014.
Its interest rates are 2.10 per cent AER between £1 to £14,999; 2.20 per cent AER from £15,000 to £29,999; and 2.30 per cent AER above £30,000.
Barclays has also launched instant cash Isa issue one for those who need full savings access.
Barclays said that this provides a “simple and transparent” account, unlimited instant access to money and the flexibility to save the allowance in a lump sum or contribute over the tax year.
The same rates and tiers apply as the three-year flexible cash Isa but are variable and include a fixed 12-month introductory bonus of 0.80 per cent tax-free a year.
Both cash Isas allow transfers-in from existing cash Isas. Transfer-in requests to the instant cash Isa can be made at any time, but requests to the three-year flexible cash Isa need to be made within 30 days of opening the account.
Barclays is also participating in the new electronic cash Isa transfer service to improve and speed up the process for customers.
In addition, it is offering a range of 70 easy-to-manage funds available within an investment Isa, all provided with 0 per cent initial charge and cashback.
REACTIONS
PROVIDER VIEW
Lee Chiswell, head of savings at Barclays, said: “This year sees the launch of our exciting new flexible cash Isa, which will give customers the best of both worlds: the peace of mind of a fixed rate over the longer term with the flexibility of being able to access a proportion of their savings when they need it. We understand that times are tough; with inflation running high and household budgets squeezed, it is now more important than ever for savers to make their money work as hard as possible by taking advantage of their full tax-free allowance. With this in mind, we are enabling customers to transfer-in to our new range of cash Isas this year so they can earn a competitive rate on the cash Isa balances they have built up historically – which could be up to £85,000 if an individual has put away the maximum allowance each year since cash Isas launched in 1999.”
ADVISER VIEW
Anna Bowes, director of Savings Champion, said: “Quite simply you can get much better elsewhere – on both the fixed and variable offerings. On the instant access Isa you can earn 2.50 per cent from the Cheshire Building Society (easy access, minimum £1,000 and 2 per cent bonus until 31/7/14). And for those with lower balances you can get 2.25 per cent on a minimum of £1 with Harpenden Building Society, with no bonus. How long these rates will be around for though is anyone’s guess. For those that have current accounts with First Direct and HSBC, you can get 3 per cent (£40,000 or more) and 2.75 per cent (£15,000 or more) respectively – both accept transfers. With regard to the fixed-rate offering, Nationwide has a 30-month fixed-rate Isa that pays a flat rate of 2.55 per cent on a minimum balance of £1. So if this is Barclays offering for the season, they’re not really trying very hard and it does set the tone for what we might expect: a very underwhelming Isa season.”
CHARGES
There are no charges associated with either the three-year flexible cash Isa issue one or the instant cash Isa issue one.
VERDICT
Despite assurance from Barclays’ new chief executive, this is not a great deal and savers would be better looking elsewhere.
