CMC Invest launches a versatile Isa – this is the way it compares to rivals because it turns into the most recent platform to supply tax-free account

Products featured in this article are independently selected by This is Money’s specialist journalists. If you open an account using links which have an asterisk, This is Money will earn an affiliate commission. We do not allow this to affect our editorial independence.

The cash Isa best buy battle has been hotting up for some time – but it has not been driven by the banks or building societies.

The likes of app-based Trading 212, Moneybox, Plum and Chip have all muscled in to offer the best free tax-free deals to savers. 

Now, yet another investing platform has joined the ranks to get a slice of the action. CMC Invest has launched an easy-access cash Isa* paying 4.85 per cent.

CMC said it is launching the cash Isa in response to ‘significant customer demand.’

The cash Isa is available to new and existing customers and can be opened with a deposit starting from £1. It can only be opened by downloading the CMC Invest app.

There are no withdrawal restrictions, meaning customers can access their money as many times as they like without the rate dropping.

Customers can transfer in an existing Isa they have with other providers.

CMC Invest’s cash Isa is also flexible, meaning you can withdraw money from the Isa and replace it without affecting your Isa allowance, provided you replace it within the same tax year.

Flexibility can be a useful tool in an Isa to ensure you keep as much of your savings tax free as possible

The interest is earned daily and will be paid into customers’ account monthly.

Is your money with CMC protected?

Money kept in CMC Invest’s easy-access cash Isa is Protected under the Financial Services Compensation Scheme.

CMC is not a bank but it is authorised and regulated by the Financial Conduct Authority to take Isa deposits.

It leans on the FSCS cover of NatWest and ‘Qualifying Money Market Funds’ to protect customer deposits in its Isa up to £85,000 if it goes bust.

It is not a completely new phenomenon for firms to use Money Market Funds, says James Blower the founder of website Savings Guru.

He said: ‘This is unusual but isn’t completely new. Money Market Funds can be FSCS protected but have to meet strict criteria in order to do so. 

‘Therefore, as long as CMC’s is, savers shouldn’t have to worry but should definitely stay within the Scheme limits of £85,000. 

‘For those who prefer an authorised bank, Monument’ Banks Isa may be preferred – the 4.76 per cent rate is only 9bps lower, but that may well be worth sacrificing for savers who might be nervous.’

How does it compare to its rivals?

Trading and investing platforms Trading 212, Plum and Moneybox all offer easy-access cash Isas with competitive rates.

Trading 212’s easy-access Isa* is also a flexible Isa with no withdrawal restrictions. It is paying 4.9 per cent interest.

This is the best account if you are looking for a true easy-access Isa that doesn’t cut your rate for withdraw money with a competitive rate. The rate does not include a bonus rate which disappears after 12 months either.

The Isa can be opened with a deposit starting from £1 by downloading Trading 212’s app.

Plum’s easy-access Isa* offers the best rates at 5.18 per cent and 5.17 per cent, respectively but both have restrictions on how many times you can withdraw your money before the rate drops and contain bonus rates.

Plum’s rate of 5.18 per cent includes a bonus rate of 1.39 per cent for the first 12 months and the underlying rate is a variable 3.79 per cent.

Customers can also only make up to three free withdrawals without any impact on their rate. After the fourth withdrawal, the rate drops to 2.5 per cent.

Transfers in from another Isa are currently not eligible for the bonus rate, so any customers transferring an Isa will only earn 3.79 per cent.

Moneybox’s cash Isa, paying 5.17 per cent cash Isa includes a bonus rate of 0.47 per cent for the first 12 months, with the underlying rate a variable 4.7 per cent.

The account can only be opened by downloading Moneybox’s app with a minimum deposit of £500.

You can only make three free withdrawals in a 12 month period with this Isa. On a fourth withdrawal, the rate drops to 0.75 per cent. 

If your Isa balance dips below £500, your rate will also drop to 0.75 per cent.

You can transfer in Isas you hold with other providers to Moneybox’s Isa. The interest is calculated daily and paid yearly.

This Isa is not a flexible Isa, so any money you withdraw from it cannot be replaced within the same tax year without affecting your £20,000 Isa allowance. You will lose whatever amount you withdraw from the allowance.

Who is CMC Invest?

CMC Invest is part of CMC Markets Group which was founded in 1989 in London, UK.

In 2022, CMC Markets Group, which primarily offers high-risk spread betting and CFDs, launched CMC Invest to offer customers share dealing in UK and US stocks, alongside ETFs and investment trusts.

It launched a flexible stocks and shares Isa in December 2022.

It has over 1.5million global traders and investors as customers. The company is listed on the London Stock Exchange.