Leeds to launch online access Isa

Leeds to launch online access Isa

Leeds Building Society will launch an online-only instant access Isa this week amid continued demand for the savings product.

From tomorrow (4 October) the society will offer the online Isa at a rate of 1.36 per cent with penalty-free instant access and tax free returns.

The Isa is a limited product with a minimum investment of £1,000.

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Jaedon Green, director of product and distribution at Leeds Building Society, said Isas were a popular choice among the provider's savers.

He said: "As we reach the halfway point in the financial year, it is an ideal time for Isa savers to give their investment a quick MOT.

"Many other providers have seen reduced demand for Isas whereas we continue to perform strongly in this market and offer a choice of fixed and variable products across different channels so our members can pick the one which suits them best."

Mr Green said the introduction of the personal savings allowance may have made Isas less attractive to some savers, but he believes it is still important to be able to ensure savings are tax-efficient in the longer term.

He added: "We permit transfers in of previous years’ subscriptions to enable savers to maximise this benefit."

Rachel Springall, finance expert at Moneyfacts Group, said Leeds' rate compared with the current average easy access Isa rate of 0.92 per cent. 

She said: "At 1.36 per cent, the new Isa from Leeds Building Society sits towards the top of the easy access Isa market, with Al Rayan Bank paying 1.35 per cent gross and 1.36 per cent AER as an expected profit rate.

"Savers looking to utilise their Isa allowance but also want quick access to cash will be delighted by this latest offering.

“Anyone looking to invest may want to act fast, as the Isa has been branded with ‘limited edition’ so it could have a short shelf life."

Ms Springall suggested it was worth considering other higher rates available on easy access accounts without the Isa wrapper, such as Goldman Sachs' Marcus savings account paying 1.50 per cent. 

She added: "If savers can, it is worth utilising any personal savings allowance over the short-term, but they also should not ignore any Isa allowance they may have to use."