We are incredibly pleased that the Cash ISA Promise has been so well received by customers
(PRWEB) November 10, 2011
Recent Halifax research shows that many UK savers are continuing to make use of their annual ISA allowance. The average ISA balance across the UK is now £8,505 and is equivalent to a third of national average pre-tax annual earnings1 of £27,235.
Although it is encouraging to see that many savers are using ISA allowances, according to the Department of Work and Pensions' Family Resources Survey (FRS) 2009/10, only two out of five households in the UK have an ISA product2.
ISA Balances in 2011
Savers in 32 local areas hold average balances in excess of £10,000. ISA customers in South Buckinghamshire have the highest average balance, which at £11,059 is 30% higher than the UK average of £8,505, with Harrow (£10,976) and Chiltern (£10,958) following closely.
Twenty-two of the 30 local areas with the highest cash ISA balances are in southern England, the South East holds the highest average balance by region of £9,142.
At the other end of the spectrum, there are four areas where the average balance is below £6,000: West Lothian (£5,889), Newham (£5,835), Glasgow City (£5,750) and Hackney (£5,455). Average ISA savings in Hackney are more than a third below the national average (See Table 2). The lowest region of ISA savers are in Scotland, with an average balance of £7,078; 17% below the UK average (See Table 3).
ISA saver pots determined by age
Older customers are more likely to have ISA savings and indeed higher balances. Savers in the age band from 55 to 64 have an average balance of just over £11,000. This rises to £12,479 for those aged 65-74 and to £14,111 for those who are 75 and above (66% above the average for all ISA savers).
By contrast, savers in the age band 25 to 34 have an average balance of £3,100 (64% below the average for all savers) and those who are between 35 and 44 have an average ISA balance of £4,798.
Halifax' challenge to the Cash ISA market
The Halifax Cash ISA Promise, which came in to effect on 2 October 2010, challenged the market by addressing key issues customers face during the lifetime of their cash ISA – in particular, losing the benefit of a better deal due to delays in the transfer process. All customers switching their existing cash ISA to Halifax now earn interest from the first day their completed application form is received either in branch or by post.
One year on from its launch, the Halifax Cash ISA Promise has increased the ISA pots of UK savers by an extra £10 million in interest.
Simon Kenyon, Director of Savings, said:
"We are incredibly pleased that the Cash ISA Promise has been so well received by customers, it clearly addresses a real issue. ISA savers across the UK are already feeling the benefit to the tune of £10million."