[Please note this article has been updated since it was originally published]
Yet another best buy ISA is made available to locals only. The Mansfield building society cash ISA is now only available to those savers who live in Nottinghamshire, Derbyshire or South Yorkshire or have been an existing member of the Mansfield building society for three years continuously, a change that happened early last month.
They are not alone. This year, whilst many of the very best ISA rates are offered by building societies, there are many barriers that will not allow most savers to gain access.
An increasing number of ISAs are becoming restricted to existing or local customers as the building societies take centre stage offering some of the best rates available.
It’s probably no surprise as many of the banks, certainly the well-known providers, have taken a back seat, pulling and reducing many of the leading ISA rates. With over a year of rate slashing, building societies have found themselves exposed in the best buy tables with leading rates that previously wouldn’t have stood out. One way to stem the flow of applications is to limit the accounts to local or existing customers and of course look to do what building societies aim to do; support their community and customers first.
The truth however is that the ISA season has yet to gather any momentum. If you have not already used your ISA allowance for the current tax year, there may be better deals to come – but the key for savers is, ‘don’t leave it too late’. And while ISAs are at the top of your priority list, why not open next years as early as possible. The sooner you are earning tax free interest the better.
Last year’s ISA season was a damp squib and with the providers’ appetite to raise new money from savers still muted, we’re not really expecting an ISA rate war any time soon.