Review of Yorkshire Bank 40 Day Notice Cash ISA

Written by Karen Bryan

yorkshire bankThe Yorkshire Bank 40 Day Notice Cash ISA paying a variable interest rate of 1.75% on balances of £30,000+ caught my eye.

This is a competitive rate for savers with larger Cash ISA pots, without having to tie the money up for too long. The highest rate of interest that I could find for a one year fixed rate Cash ISA was 1.75% with the Punjab National Bank, which has to be opened by post or in a branch.

If the balance in the Yorkshire Bank 40 Day Notice Cash is lower, the rates are less attractive. Balances under £15,000 receive a rate of 1.0%. Balances between £15,000 and £29,999 earn a rate of 1.5%.

Unfortunately, you can only use the Yorkshire Bank 40 Day Notice Cash ISA for this year’s ISA allowance. The account doesn’t accept transfers. That made me wonder how it’s possible to have a balance of £30,000+ in order to earn the highest rate of interest of 1.75%?

Another downside the Yorkshire Bank 40 Day Cash ISA is that it appears that you can’t operate online.

You need to open the account in branch, by phone or post.

In order to withdraw any money without incurring a penalty, you need to post a letter to Yorkshire Bank giving your withdrawal instructions. Yorkshire Bank will treat that date of your letter as the start of the 40 calendar notice period. On the 40th day your withdrawal request will be processed. Payment can be made directly into the customer’s bank account through the BACs system (which can take up to two working days).

After closer examination, the Yorkshire Bank 40 Day Notice Cash ISA loses its allure. You can earn a variable rate of 1.4% on balances of £1+ with the Coventry Building Society. You can open the Coventry account online, it offers instant access and unlimited withdrawals, but again you can only put the current tax year’s ISA allowance into the account.

Why bother with the Yorkshire Bank 40 Day Notice Cash ISA? You can’t open it online, require to have a balance of £15,000 in order to earn the interest rate of 1.5%. (a measly 0.1% more than in the Coventry instant access Cash ISA), Plus you’ll have to wait at least 40 days to make a penalty-free withdrawal.

This 40 Day Notice Cash ISA is also available through Clydesdale Bank.

Rates of interest correct on 8 May 2016.