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Paragon increases fixed-rate ISA rates as the tax year end nears

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With the ISA window drawing to a close, Paragon Bank has increased rates across a range of fixed-rate cash ISAs.

The increases include:

  • One-year fixed rate cash ISA increasing from 4.65% to 5.05% AER
  • Two-year fixed rate cash ISA increasing from 4.20% to 4.59% AER
  • Five-year fixed rate cash ISA increasing from 3.75% to 4.00% AER

The new rates are available from Friday 15 March. Paragon’s range of savings products can be opened and managed online, over the phone or by post, with the fixed-rate ISA range requiring a minimum balance of £500, up to a maximum of £500,000 plus any resulting interest.

All of Paragon’s ISAs are eligible for the ISA Wallet feature. This allows savers to spread their £20,000 annual ISA allowance with Paragon across multiple cash ISAs, rather than just opening one specific account.

The 2023/24 tax year finishes on 5 April, meaning savers have just weeks left to utilise their £20,000 ISA allowance.

Paragon Bank research of long-term savers shows that a large proportion of ISA savers leave it late, with three in 10 typically making a lump sum payment towards the end of the tax year.

The survey of over 2,000 savers showed that 58% attempt to meet their full ISA allowance each year, with 41% having paid tax on their savings in the previous year.

Meanwhile, Paragon analysis of CACI data shows that £10.7 billion and £13.4 billion were placed in new adult cash ISA accounts in March and April respectively last year, with the majority of that cash in one-year accounts. March ISA new business levels were 256% higher in 2023 than the previous year, with April 154% higher.

Derek Sprawling, Paragon Bank Savings Director, said: “Last year was one of the busiest ISA seasons on record, with much of that money directed towards one-year variants. As those rates mature, we want to offer savers competitive options for their ISA cash.

“A large cohort of ISA savers also typically leave it late in the tax year to utilise their £20,000 allowance, so we expect a busy few weeks before the tax year ends.”

Paragon Bank grew savings deposits by 24.3% in its last financial year to £13.3 billion and was recently awarded Cash ISA provider of the year by MoneyComms.

For further information contact:

Michael Clarke
Head of Media Relations
Paragon Bank

Notes to editors:

CACI compiles the savings deposits of 35 leading providers of cash savings.

Paragon surveyed 2,000+ savers in November 2023

Paragon Bank PLC is a subsidiary of the Paragon Banking Group PLC which is a FTSE 250 company based in Solihull in the West Midlands. Established in 1985, Paragon Banking Group PLC has over £14 billion of assets under management, helping more than 340,000 customers to achieve their ambitions.

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551.