Spotlight: Natwest's 0.5% ISA bonus

Simon Read
Friday 05 February 2010 20:00 EST
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The deal

NatWest is currently offering a 0.5 per cent gross bonus, fixed for 12 months, on its cash ISAs. RBS, part of the same banking group, is offering the same deal.

The good points

All interest in an individual savings account is paid out tax-free.

The bad points

NatWest's rates on its instant access ISA are extremely mean. Even with the 0.5 per cent bonus you'll only get 1.05 per cent on less than £9,000, rising to just 2.5 per cent if you have £50,000 or more in your ISA.

On top of that, to qualify, you'll need to pay in the full 2010/11 cash ISA allowance of £5,100 before 30 April 2010 or transfer your cash ISA from another company.

Conclusion

This is one bankers' bonus to ignore. There will be other deals coming to market in the next few weeks as ISA season hots up and they will be hard pushed to be worse than this offer.

Standard Life, for instance, pays 2.65 per cent on £1 in its instant access ISA, while Barclays pays 2.58 per cent.

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