Intelligent Finance - Press Release

20 March 2003

TAX RELIEF BUT LITTLE 'RATE RELIEF' FOR ISA SAVERS

Millions of UK savers have been hit by sliding mini-cash ISA rates since their launch just four years ago, new research from Intelligent Finance has revealed.

TOP TEN PAYING MINI-CASH ISAS ALL 'FALL FROM GRACE'

Not a single one of the top ten paying instant mini-cash ISAs launched in 1999 when ISAs first came on to the market has consistently remained in the top ten paying accounts since.

Indeed, only two out of the top ten paying accounts even managed to last out the first year before slipping out of the top ten paying mini cash ISA accounts.

Commenting, Grenville Turner, Chief Executive, Intelligent Finance said: "Consumers need to select a provider who will provide long-term value for their savings, especially if they don't have the time or inclination to chop and change accounts every couple of months. At Intelligent Finance, we believe we give savers better value than traditional banks through our competitive rates and offset offer. Our ISA, with its one-year rate guarantee, is further evidence of our efforts to ensure people's savings work harder for them."

ONLY 5% OF ISA HOLDERS SWITCH ACCOUNTS

Many banks and building societies are no doubt taking advantage of the massive consumer inertia in the ISA market. Despite the propensity of cash ISA accounts to become less competitive, only some 5% of ISA holders have ever switched their ISA provider.

7.65 MILLION PEOPLE DON'T KNOW THEY CAN SWITCH ISA PROVIDER

This low rate of switching is hardly surprising when some 7.65 million people - some 17% of the adult population - who haven't ever moved, didn't even know they were able to switch their ISA providers.

Intelligent Finance's research once again highlights the limitations for consumers of simply using best buy tables when it comes to choosing their financial products. Many providers continue to launch products with attractive rates only to quickly cut these rates once they have won substantial new business.

Whilst best buy tables offer consumers no guarantees, Intelligent Finance does. Intelligent Finance recently bucked the trend of falling ISA rates by raising its rate from 3.7 to 4.05%. The bank has also introduced a guarantee to pay at least 0.3% above the base rate until 5 April 2004.

Since its launch Intelligent Finance has also reduced the rates paid on its instant access savings account by less than the reductions in the Bank of England base rate.

For more information contact Heather Scott 0131 658 2301, mobile 07770 643840, home 01875 852925, email heatherscott@if.com.

NOTES TO EDITORS

1. Intelligent Finance's new ISA rate will be paid to both new and existing customers from 15 March 2003.
   
   
2. ICM Research interviewed a random selection of 1020 adults aged 18+ by telephone between 5-6 March February 2003. Interviews were conducted across the country and the results have been weighted to the profile of all adults.
   
   
3. In 1999, the top ten instant access mini cash ISA accounts were provided by: Abbey National, Alliance & Leicester, Britannia, First Direct, Monmouthshire BS, National Savings, Northern Rock, Progressive BS, Safeway, Stafford Railway BS, Vernon, Woolwich

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