Amid speculation of upcoming changes to the tax-free allowance, saving into cash ISAs has just hit a record high.
Data published by the Bank of England showed that a record £14 billion was invested in cash ISAs as the new tax year began in April 2025.
This is the highest amount deposited into cash ISAs since the data publication series started in April 1999. In total, households’ deposits with banks and building societies increased by £3 billion in April.
The effective interest rate paid on individuals’ new time deposits with banks and building societies rose by 7 basis points, to 4.02% in April.
The large amount invested in cash ISAs comes ahead of a potential change to the cash ISA allowance, with Chancellor Rachel Reeves rumoured to be mulling revisions to the current rules.
It is widely speculated that Reeves may seek to reduce the tax-free allowance for cash ISAs while retaining the allowance of £20,000 per year for stocks and shares ISAs to encourage investment in business. Currently, the tax-free allowance amount for both types of ISA is the same.
The Bank of England data also showed that in April, net borrowing of consumer credit individuals increased to £1.6 billion. Net borrowing through credit cars was £0.8 billion, a significant increase over the £0.4 billion recorded in March.
Net borrowing through other forms of consumer credit such as car dealership finance and personal loans increased slightly to £0.8 billion, from £0.7 billion over the same period.
The graphs below show consumer credit and household deposit data from the Bank of England for April 2025.
Consumer Credit Stats
Household Deposit Stats
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