Northern Rock launches competitive fixed rate e-ISAs
Northern Rock is launching three new issues of its of new online ISA to complement its competitive portfolio of branch, postal and online savings accounts.
e-ISA offers those who prefer to operate their accounts via the internet, an online option for their tax-free* savings. e-ISA is a fixed rate cash ISA set at a competitive rate of interest over a choice of one, two or three years.
Northern Rock’s Customer and Commercial Director Andy Tate said: “Our customers want options. They want to be able to choose the best account to meet their individual needs, whether that be tax-free or not, and variable or fixed rate.
“They also want to be able to choose the most convenient method by which to operate their account - by post, in branch or online. Northern Rock is proud to be able to offer fixed and variable rate savings accounts, as well as fixed rate tax-free options, via every one of the available channels with our e-ISA range.
“We are pleased to increase our e-ISA rates today, as previous issues have been very well received by our customers and the market as a whole.”
Fixed rate e-ISA (Issues 4, 5 and 6)
For customers who prefer to earn a fixed rate of interest on their tax-free* savings, Fixed Rate e-ISA can be opened with no minimum initial deposit.
Interest, which can be added to the account or paid into another account, is paid annually on 5 August on minimum balances of £500 (balances which fall below this amount will earn Northern Rock’s prevailing rate of interest, 0.10% tax free*/AER** pa).
Strictly limited issues, the fixed rate e-ISAs (issues 4, 5 and 6) allow transfers in from other providers and additional deposits can be made to the cash ISAs, within HM Revenue and Customs limits (£5,100 pa from April 2010) up to 30 days after the product is withdrawn.
After this time, no further deposits will be accepted and all three issues may be withdrawn without notice once fully subscribed.
Minimum withdrawals of £1 by BACS and £250 by CHAPS can be made from the account, subject to a charge equivalent to 60 days’ loss of interest on the amount withdrawn (Issue 4), 90 days’ loss of interest on the amount withdrawn (Issue 5), or 120 days’ loss of interest on the amount withdrawn (Issue 6). There is a £35 fee for transfers out via CHAPS.
*The tax-free rate is the contractual rate of interest payable where interest is exempt from income tax.
**AER stands for Annual Equivalent Rate and shows what the interest rate would be when interest is paid and added to the capital balance each year.
Further information on Fixed Rate e-ISA:
• All three issues may be withdrawn at any time. Once withdrawn no further deposits will be accepted after a period of 30 days.
• Available as fixed rate cash ISAs. Max investment of £5,100 in tax-year 2010-11.
• Deposits into the Fixed Rate e-ISA will be allowed from all Northern Rock variable rate accounts, instant access and notice accounts (transfers from Northern Rock internet accounts must be via the nominated bank account).
• ISA transfers in will also be accepted from other organisations up to the maximum Northern Rock limit of £2m. Partial transfers are not permitted. Withdrawal transfers by CHAPS will be subject to a fee of £35.
• Transfers out require a signature and will be subject to five business days processing and a charge equivalent to 60 days’ loss of interest (fixed rate cash e-ISA issue 4), 90 days’ loss of interest (fixed rate cash e-ISA issue 5), or 120 days’ loss of interest (fixed rate cash e-ISA issue 6).
• Withdrawals within the fixed rate period will be subject to the same respective loss of interest charges as detailed above. Minimum withdrawal amount is £250 by CHAPS and £1 by BACS.
• Interest will be paid annually on 5 August in the case of all three issues. It can be accumulated to the account(s), or paid to another account (subject to the Terms and Conditions of that account), and accessed upon maturity of the account on 24 April.
• In the final year, any additional interest earned after 5 April will be added to the capital balance and paid upon closure of the account. If the interest is sent to an external bank or building society account then the interest will be credited to that account in 3 working days following the maturity of the applicable e-ISA.
• Available to open and operate via Northern Rock’s website.
• On expiry of the fixed rate, the interest rate payable will be the prevailing variable rate on Northern Rock’s matured cash e-ISA, excluding any introductory bonuses.
• Balances below £500 will earn the basic savings rate of 0.10% tax free* per annum.
• Notice-free access will be available for 30 days from maturity (the account will then be subject to 30 days’ notice or 30 days’ loss of interest on the amount withdrawn).
* The tax-free rate is the contractual rate of interest payable where interest is exempt from income tax.
Visit northernrock.co.uk for further details.