The savings market has been given a boost following the launch of a new Cash ISA (Individual Savings Account) from the Coventry Building Society.
The Poppy ISA was first launched last Wednesday with an interest rate of 2.5%, however, this was quickly increased to 2.6%, pushing it to the top of the best buy savings tables.
The rate of 2.6% includes a bonus of 0.60% for the first year; experts have warned that whilst the interest rate will be competitive for the first year, it will be less attractive when the bonus is removed after 12 months.
Savers will be able to withdraw funds from the ISA at any time without charge. Savers will also be able to deposit either a lump sum make regular payments, up to a maximum of £5,760, during the 2013/14 tax year.
Although the interest payable is below the current rate of inflation, the new Poppy ISA will certainly be of interest to many savers, looking for a competitive return as we enter the new tax year,
Customers will be able to open their ISA with as little as £1, in a branch, over the phone, by email or by post.
Launch of first Poppy ISA
Colin Franklin, Sales and Marketing Director at Coventry Building Society, said: “We are absolutely delighted to be launching our first ever Poppy ISA.”
He continued: “In the current low base rate environment, it’s more important than ever that savings are working as hard as possible, so savers need to make the most of their tax free allowance.”
Since the ‘Poppy’ savings account launched back in 2008, Coventry Building Society has donated over £7.5 million to the Royal British Legion.
The new ISA will see the Coventry Building Society continue to donate to the charity, by giving 0.1% of the average balance of ISA savers to the cause.
The building society has a long tradition of donating to charities and has also helped the Jimmy Hill tribute appeal.