Interest on cash ISA: how much do they pay?

Written by
Bence András R.
Fact checked by
Gyula L.
Jan 2024
Interest on cash ISA: how much do they pay?

Interest on ISA is a benefit for anyone, who holds a cash ISA account at a broker, bank, or financial service. It is one of the ways to grow your wealth in a tax-efficient way. But how much interest does an ISA pay? What factors are considered for cash ISA interest rates?

Let's take a look! 


  • Cash ISA is a tpye of Individual Savings Accounts (ISAs) where you earn interest on your cash deposits if you keep it on your account. 
  • Annually, you'd receive anything between 2.0%-4.0% on your deposit amount.
  • The interest rate is dependent on many things, but mostly on the length of the contract between you and the provider, on the current economic situation, and on how the provider structures its fees.
  • The ISA interest rate in the UK is also called Annual Equivalent Rate, aka. AER. 

How much interest does a cash ISA pay?

The interest on cash ISAs range from 2.0% to 4.0% as of 2023.

In more detail, a range of different factors can have an influence on the AER. AER is short for Annual Equivalent Rate - basically the rate of interest you might receive. 

  • how long have you put your money away without withdrawing a penny
  • what is the base rate of interest in the UK is
  • whether you choose a fixed rate or variable rate 
  • how the fees are structured.*

These factors are all considered in the most popular cash ISA AER offers. There are two main types of cash ISAs:

  • Fixed-rate ISAs: where you agree on an interest that will be paid after the agreed length of the deposit is over. 
  • Variable-rate ISAs: the interest rate is ever-changing based on multiple factors, and can be lower or higher in the future

Both versions come in yearly and monthly setups. This means you can agree on different periods of time to leave your cash in your account.

If you put your money in the account for a longer time, the interest rates are usually higher.

After withdrawal, you can spend your initial deposit + interest on whatever you'd like. There are no constraints, like for example for a Lifetime ISA

*E.g., some providers who are offering unnaturally large interest rates, might charge higher commissions on deposits, withdrawals or other parts of the service to make up for the high AER.


Looking for the best ISA broker?

We, at BrokerChooser, are working hard to provide you with the best broker options for your investments.

We put together a unique methodology analyzing hundreds of categories per service to show you the best brokers to open an ISA account

The first step in investing and trading is always the most difficult one. But you'll be glad that you've taken this step - even just after a few days! To help you, we also collected all data you need to know about the best investment providers in the United Kingdom.

If you need any help or want to engage in a lively conversaiton with our experts and fellow traders. head over to the BrokerChooser Community page.

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Further reading

Author of this article

Bence András Rózsa
Bence András Rózsa

Bence is a former broker analyst for BrokerChooser. Having an MSc in international economy and finance, he focused on equities, cryptos and newcomer financial services. He also gained years of experience within the brokerage industry, specializing in stock and CFD/forex brokers, crypto providers and robo-advisors.

Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology.

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