What are the current HSBC Cash ISA rates?

Keep in mind that the big high-street banks don’t always offer the most competitive rates. To really make the most of your money, take a look at our guide to the Best Cash ISAs in the UK.

What are the current HSBC ISA rates?

HSBC currently offers three Cash ISAs, but two of these savings products is only available to those with an HSBC current account and another is only available to HSBC Premier customers. Their Cash ISA interest rates range between 4.45% (fixed) AER and 2.85% (variable) AER, depending on what account you pick and are eligible for.

1. HSBC Fixed Rate Cash ISA: 4.45% (fixed) AER tax-free fixed for up to 13 months, after which the account will become an HSBC Loyalty Cash ISA. You must open the account with a minimum of £500, and you have 30 days to deposit savings into the account before your money is locked away. If you want to withdraw your money, be aware that you will need to take all your money out of the account, and the account will be closed. You will need to pay an early closure fee, which will be the lower of the interest earned on your account or a maximum of 90 days’ interest. To be eligible, you must be 18 years old or over, be a UK resident and have a current account with HSBC.
2. HSBC Loyalty Cash ISA:  2.85% (variable) AER (2.81% tax-free) loyalty rate, fixed for 12 months. You only have to open the account with a minimum of £1, but if you make further payments into the account, your loyalty rate will start again from the date of each payment. So the more payments you make into the account, the longer you can benefit from the loyalty rate. If you do not make any further payments into the account, at the end of the 12-month loyalty period your interest rate will change to a 2.50% (variable) AER standard rate of interest until you make a further payment. To be eligible, you must be 18 years old or over, be a UK resident and have a current account with HSBC. This is an instant access Cash ISA, so you can make as many fee-free withdrawals as you like, but be aware if you withdraw funds and then deposit them back into the account, this will count towards your annual ISA limit.
3. HSBC Loyalty Cash ISA (Premier customers only): 3.20% AER (3.15% tax-free), fixed for 12 months. You only have to open the account with a minimum of £1, but if you make further payments into the account, your loyalty rate will start again from the date of each payment. So the more payments you make into the account, the longer you can benefit from the loyalty rate. If you do not make any further payments into the account, at the end of the 12-month loyalty period your interest rate will change to a 2.50% (variable) AER standard rate of interest until you make a further payment. To be eligible, you must be 18 years old or over, be a UK resident and have a current account with HSBC. This is an instant access Cash ISA, so you can make as many fee-free withdrawals as you like, but be aware if you withdraw funds and then deposit them back into the account, this will count towards your annual ISA limit.

Source: https://www.hsbc.co.uk/savings/isas/. Current HSBC Cash ISA rates are accurate as of August 2024.

What is HSBC’s best ISA rate?

HSBC’s best cash ISA rate is 4.45% AER, which you can get by opening a HSBC Fixed Rate Cash ISA. The interest rate is fixed, meaning it won’t rise or fall during the set time period. However, if you want to access your money before the end of the fixed term, you’ll need to withdraw all your savings and your account will be closed. You’ll also pay an early closure fee, which will be the lower of the interest earned on your account or a maximum of 90 days’ interest. This means that if you close your Fixed Rate Cash ISA within the first 90 days, you may not receive any interest at all. To be eligible for this account, you also need to be an HSBC current account holder. 

If you’re saving for short-term goals or there’s a chance you’ll need access to your money in an emergency, you may be better suited to an easy-access Cash ISA. 

Thankfully, you should be able to find a more competitive and accessible alternative with a different provider. Take a look at our guide to the best Cash ISAs on the market for more information.

Is HSBC a good ISA provider?

HSBC’s interest rates are competitive, but its best Cash ISA is only suitable for savers who are able to lock their money away for a 13-month period. HSBC is just one of hundreds of ISA providers, so it’s a good idea to compare savings accounts before choosing one for you. It may be tempting to open a Cash ISA with one of the big high street banks (particularly if you have a current account with them already), but you may be able to find better rates, terms and improved customer service from a smaller provider.

Can I have two ISAs with HSBC?

You can only have one Cash ISA with HSBC, but you could have an HSBC Cash ISA and a Cash ISA with a different provider. If you’ve got an HSBC Cash ISA already but you’re looking for a better interest rate, another option is to transfer your account to a new provider. You may find it easier to manage your tax-free savings when they’re all in the same place. 

If you’re a first-time buyer and you’re saving a deposit, a Lifetime ISA (LISA) can be even more rewarding than a traditional Cash ISA. Save up to £4,000 of your total ISA allowance in a Lifetime ISA each year and you’ll get a 25% bonus from the government, up to £1,000. You must be aged 18-39 to open a LISA, and can only use it towards your first home purchase if you’re a first-time buyer or retirement. 

So, if you max out your LISA for 4 years in a row, you’ll have a £20,000 deposit towards your first home — even more if you choose a LISA with a competitive interest rate. HSBC doesn’t offer Lifetime ISAs, but we do! With the Tembo Cash Lifetime ISA, not only will you get the 25% government bonus, you’ll also benefit from a market-leading 4.3% AER interest rate (variable).

Will HSBC increase ISA rates?

HSBC could increase its ISA rates, but it could lower them instead. There’s no way of knowing exactly what will happen to interest rates in future, but banks, building societies and other ISA providers tend to change their interest rates based on changes to the Bank of England’s base rate. If you already have a fixed rate Cash ISA with HSBC, your interest rate will stay the same for the remainder of your fixed term, even if HSBC does make changes to its ISA rates.

Learn more: Cash ISA or Lifetime ISA. Which one should I pick?

How to find the best Cash ISA Rates

There are lots of Cash ISA providers to choose from and some of the best ISAs can be opened and managed via an app, rather than through a branch. The interest rate is important, but it’s also smart to compare customer service quality, how easy it is to access your money and whether the provider offers any bonuses or rewards. 

At Tembo, for example, our award-winning savings app has helped thousands of savers. It’s no wonder we’ve been rated Excellent on Trustpilot!

Take a look at our guide to the best Cash ISA rates for a handy breakdown of the most competitive accounts. 

How to transfer my HSBC ISA to another provider

It’s easy to transfer your HSBC ISA to another provider. Simply open an ISA with your chosen provider and ask them to complete the switch for you. Avoid making the transfer yourself, as this can impact your savings’ tax-free status and this year’s ISA allowance! 

For example, let’s imagine you’ve saved £20,000 in a Cash ISA over a number of years and you’d like to transfer your savings to another provider. If you try to move the money yourself, this will use up your full £20,000 ISA allowance for this tax year - even though your contributions were originally made during previous tax years. You’ll need to wait until the following tax year to make any more ISA contributions. Until then, you’d need to keep the money in a traditional savings account, where your interest would be taxed.