Savers chipped in £4.6bn into cash ISAs in February as deposits with banks and building societies increased by £5.8bn, according to the latest Bank of England money and credit data released today.
The cash Isa figure was £1bn higher than in February 2025.
The typical cash ISA rate was 1.9% in February, significantly below the current rate of inflation.
Charlene Young, AJ Bell senior pensions and savings expert, said: “Tax year end often means a rush to use allowances, but savers still ploughed an extra £4.6bn into cash ISAs in February.
“Flows for the month were nearly 30% higher compared to February 2025, despite expectations at the time that we would see a cut to the Bank of England base rate in March.”
She pointed out that more than £283bn was sitting in cash accounts earning no interest.
Meanwhile the cut to the Cash ISA allowance for under-65s was still more than a year away.
She said: “We now know under-65s will be restricted to £12,000 per tax year for their cash ISA savings from April next year, as part of the government’s campaign to drive a culture of retail investing in the UK.”
Ms Young said there was a danger the continued flight to cash will lead to savers losing out when it comes to real returns.
She added: “The average annual cash ISA interest rate in February was 1.9% (including unconditional bonuses), and non-ISA accounts were only offering an average of 2.12%, providing little compensation for the lack of protection from tax.
"Last week’s inflation figures showed prices rose by 3% in the year to February, before the impact of the shock to oil and energy prices following the eruption of conflict in the Middle East has even begun to filter through to households.”