Spotlight: ISAs

ISA season has come round again and the banks are battling it out for your cash. RBS and Natwest have launched an instant access cash ISA deal – the Cash ISA Plus – offering 3.51 per cent AER for a minimum initial investment of £1. It's a competitive rate, with closest rivals Alliance & Leicester and Egg coming in closer to 3 per cent. But the offer also shows just how keen the banks are to maximise their cash holdings, with far better deals for slightly more commitment.

The banks are offering a 0.5 per cent bonus for existing customers when these accounts hold the maximum £3,600 for both this tax year and the next (which begins on 6 April). If you're a fee-paying premium account holder, that bonus will be an even greater 1 per cent.

These rates are worth considering, regardless of what account you hold. Equating to 4 per cent for standard customers and 4.5 per cent for premium account customers for the first year, the nearest alternative is around 3.5 per cent from Manchester Building Society.