Are cash ISAs falling out of favour?

Cash ISA openings are trailing those of stocks and shares ISAs, new research shows, suggesting investors are front-running potential government reform

A young couple planning whether to invest savings into a cash ISA or stocks and shares ISA
(Image credit: zhanghaoran521 via Getty Images)

Cash ISA reforms are in the government’s sights as it looks for ways to reinvigorate the UK’s private markets. New research suggests, though, that people might be moving away from cash ISAs of their own accord.

Different kinds of ISA can be used for different purposes. Cash ISAs and stocks and shares ISAs are two of the most popular. A cash ISA is effectively a savings account that offers tax-free interest, while a stocks and shares ISA allows you to invest in funds, stocks and trusts.

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Market value of ISAs by type

Type

2018 to 2019(£ million)

2022 to 2023 (£ million)

% change

Stocks and Shares ISAs

314,031

430,775

+37%

Cash ISAs

269,649

294,329

+9%

Dan McEvoy
Senior Writer

Dan is a financial journalist who, prior to joining MoneyWeek, spent five years writing for OPTO, an investment magazine focused on growth and technology stocks, ETFs and thematic investing.

Before becoming a writer, Dan spent six years working in talent acquisition in the tech sector, including for credit scoring start-up ClearScore where he first developed an interest in personal finance.

Dan studied Social Anthropology and Management at Sidney Sussex College and the Judge Business School, Cambridge University. Outside finance, he also enjoys travel writing, and has edited two published travel books.