Alliance & Leicester Direct ISA Issue 2 "could save Brits millions"

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Alliance & Leicester Direct ISA Issue 2 "could save Brits millions"

Thu 9th Mar 2006

It has been claimed that Brits could collectively save up to £424 million by taking up an offer such as the Alliance & Leicester Direct ISA Issue 2.

The finance group claims that less than half of the people in Britain that save or invest have a mini-cash ISA and 88 per cent are more interested in a high interest rate over tax benefits.

According to the bank's research, people were put off taking up ISAs for fairly simple reasons.

Some 21 per cent of respondents said they did not know what a mini-cash ISA was and 15 per cent reported that they did not understand the system under which ISAs operated.

One in five people believed that they did not have enough money to open an ISA, while nine per cent were discouraged by thinking that they would not gain access to their invested money once their account had been opened.

Mike Woodward, manager for savings at Alliance & Leicester, said: "It is disappointing that after seven years, the take-up of cash ISAs is still fairly low. It seems that despite a relatively high awareness, there are still myths and misunderstanding surrounding cash ISAs."

The Alliance & Leicester Direct ISA Issue 2 is currently offering an added bonus of 0.7 per cent on its interest rate until April 30th 2007, making it 5.2 per cent gross per year until that date.

Instant access to funds is permitted with the scheme, which can be opened online or in a branch and requires a minimum opening balance of £1.