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Credit crunch 'boosts popularity of Isas'

By Sarah Engle, Thu 31 Jul 2008 - Published in Banking

More people who compare money-saving deals are opting for individual savings accounts (Isas), according to the Building Societies Association (BSA).

Spokesperson for the BSA Rachel Le Brocq said: "There are some very competitive rates that are pulling in savers. I think people should look around and be aware of what is being offered."

She added Isas were particularly popular because people were looking for a secure home for their cash during the current economic downturn.

BSA figures reveal during the first half of 2008 building societies experienced record amounts of cash being deposited in savings accounts.

Some £6,296 million was set aside for a rainy day between January and June, in comparison to £3,862 million during the first six months of 2007.

Moneyfacts.co.uk claims building societies currently hold over 38 per cent of all cash Isa balances.

The average interest accrued on a £3,000 cash Isa during its first year is £164.51.