‘Record’ choice of cash Isa products as rates expected to be ‘higher for longer’

The choice of cash Isas on the market reached a record high in April, according to a financial information website.

Some 712 cash Isa products were available at the start of April, Moneyfacts said, marking the highest total since its records started in February 2007.

Moneyfacts counts product availability at the start of each month.

The average easy access Isa rate at the start of April was 2.73%, up from 2.61% at the start of March, according to Moneyfacts’ records.

The average one-year fixed Isa rate on the market rose to 4.01% at the start of April, its highest level since May 2025, when the average rate was 4.02%, the website said.

Caitlyn Eastell, a personal finance analyst at Moneyfacts, said: “This year the competition around Isa season was particularly strong, fuelled by the fact that for savers under 65 it’s the final year for them to utilise their full £20,000 allowance.

“Providers have been enticing new deposits with attractive deals, as a result the total cash Isa product number has seen its largest monthly rise since May 2024 and stands at a record-breaking 712 deals.

“Savers should be taking advantage of this all-time high, and it may be especially timely as the new tax year is the perfect window to review their current deal and switch to ensure they can maximise their returns before thresholds tighten.”

The new tax year, which started on April 6, is a “last chance” for adult savers aged under 65 to stash their full £20,000 annual Isa allowance in cash.

From April 6 2027, changes will mean that, while the total annual Isa allowance will still be £20,000, adults aged under 65 will only be able to put away up to £12,000 in a cash Isa, with the remaining £8,000 allowance potentially going into stocks and shares.

Savers aged 65 and over will retain the annual £20,000 subscription limit for a cash Isa.

Ms Eastell said: “Markets have pivoted from the rate cut mindset seen earlier this year to a ‘higher for longer’ stance, or even potential rises, as the ongoing tensions in the Middle East threaten a fresh inflationary shock.”

She added: “Savers may enjoy more competitive returns in this environment; however, it can be a tricky balancing act because sharp spikes to household bills and inflation could quickly catch up, meaning savers may be left out of pocket.”