The Cheshire Building Society has launched a new issue of its Direct Fixed Rate ISA. The 18-month fixed-rate cash ISA pays 3.75%, taking it to the top of the best buy tables.
The account can be opened either online or by telephone with a minimum opening balance of £1,000. Withdrawals are not permitted during the term of the account but you can close it, although you will lose 180 days' interest. The account does not allow transfers from other ISAs.
As well as launching this new account, the Cheshire Building Society has also increased the rate on its variable-rate Direct Cash ISA. The account will now pay 3.16% to both new and existing customers - making it the top-rate variable ISA product.
The Direct Cash ISA is open to new subscriptions only - so no transfers in - and you'll need a minimum of £1,000 to open the account. The account can be opened online or by phone but is managed by post only. Customers can make as many deposits or withdrawals as they like.
The rate includes an introductory fixed bonus of 2.16% until 30 September 2013.
The Moneywise verdict: the Direct Fixed Rate ISA is definitely worth a look. It offers a rate of interest that is competitive without you having to lock your money up for a great length of time. You'll get a return of 0.75% more than on the best one-year accounts, while only having to wait a further six months to get your cash.
However, the Direct Cash ISA is less attractive. While it is the best instant-access account on the market it only beats the other market-leading instant-access accounts by 0.11%. And to get that extra 0.11% you will have to manage your account by post.
In contrast, the AA's Internet Access ISA pays 3.05% but as the title suggests the account can be managed online, which is far more convenient.