Savers in the North of England are being urged to shop around for tax-free returns as new analysis reveals a widening gap between the market’s best and worst-performing Cash ISAs.

Data from Investec Save shows that while the top 10 one-year fixed-rate ISAs average 4.11%, the lowest-paying accounts on the market offer just 3.15%. For a saver depositing the full £20,000 allowance, this "loyalty penalty" amounts to £200 in lost interest over a single year.

The 2027 "Cash Cap"

The findings come at a critical time for UK savers. Following the 2025 Autumn Budget, the government confirmed that the amount under-65s can deposit into a Cash ISA will be capped at £12,000 from April 2027. The move is designed to encourage retail investment in UK equities, but it creates a two-year window for cash-heavy savers to utilise the existing £20,000 threshold.

Market Disparity

The current market average for a one-year fixed ISA stands at 3.80%. However, the disparity between providers remains high:

Top 20 Average: 4.07%
Bottom 10% Average: 3.31%

David Hunt, Head of Deposits at Investec, said: “The countdown to the lower £12,000 cash ISA limit has started making it even more important that savers take the time to find the highest paying 1-year fixed rate cash ISA. The difference between the highest and lowest paying accounts is significant and savers will see the difference if they shop around for the best home for their money.”

Northern Impact

In regions like Yorkshire and the North East, where cost-of-living pressures remain a focal point, the £200 difference in interest represents a tangible loss. As the Bank of England's base rate fluctuates, analysts suggest that "inert" savers—those who leave funds in maturing accounts without switching—are the most at risk of seeing their real-term returns eroded by inflation.