Scarborough Entices Tax-Free Savers With 5.05% Fixed Rate ISA

Press release published on 14 March 2006 by Scarborough Building Society

Scarborough Building Society is encouraging people to make the most of their tax free savings allowance this season with the launch of its latest fixed rate ISA product – the Guaranteed ISA Plus - offering the head turning initial rate of 5.05%.

The limited issue tax free Mini Cash ISA account allows customers to invest from £1,000 to £3,000 per tax year - with guaranteed stepped rates starting at 5.05% fixed until 31 March 2007. This is followed by a competitive fixed rate of 4.75% until 31 March 2009, after which the account matures and reverts to the Society’s variable Mini Cash ISA rate.

Unusually for a fixed rate ISA, investors can access 50% of their investment without notice or penalty from 1 April 2007. The account can also be closed or transferred at any time before maturity, subject to 120 days loss of interest.

And, according to recent research by Mintel, more people need to be taking advantage of this kind of deal, as only around 27% of the UK population have an ISA account, despite the incentive of safeguarding their savings against tax deductions.

Tony Burdin, Head of Retail Strategy at the Scarborough, said: ‘In 2004/5, of the 9 million or so people who took advantage of a Mini Cash ISA, the average savings balance was just £2,200 – meaning most did not make use of their full £3,000 tax-free allowance.

‘Moreover, many people did not bother opening an ISA at all - missing out entirely, therefore, on the opportunity to earn tax-free interest on their everyday savings.

‘With our new limited issue Guaranteed ISA Plus being available now and hopefully beyond April 5th, customers could potentially invest both their 2005/6 and 2006/7 ISA allowances – up to £6,000 in total. However, with an initial premium rate of 5.05%, we expect the account to be popular, so I would urge investors to act now to avoid disappointment.’

As with all of the Scarborough’s mortgage and savings products, the Guaranteed ISA Plus is available to both new and existing customers.

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