Submitted by: Submitted by prashantkolekar
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Category: Business and Industry
Date Submitted: 09/18/2014 06:06 AM
ISA providers should embrace the new ISA reforms and ensure that they can offer consumers the maximum amount of flexibility that the new ISA rules can afford. The traditional line between cash and stocks and shares ISA providers is now blurred. Cash ISAs should begin looking at offering consumers a simple range of investment options, and stocks and shares providers need to consider the rates of interest that they pay on cash.
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Table of Content
Introduction
Product definitions
Abbreviations
Executive Summary
The market
The ISA market is expected to grow over the next five years, aided by the 2014 Budget changes
Figure 1: Forecast of total adult ISA subscriptions, at current prices – fan chart, 2008/09-2018/19
OEICs and Unit Trusts grow in popularity
Market factors
The 2014 Budget will shake up the savings, investments and pensions industry
Falling savings ratio has hit cash savings
The FLS and BoE base rate continue to keep ISA interest rates at rock bottom
Increasing numbers of ISAs are sold directly online
Other recent market developments
Companies, brands and innovation
The largest banks dominate the cash ISA market
Figure 2: Providers’ market share based on total retail savings balances, shown on a group basis, UK, 2013
St.James’s Place becomes the largest unit trust/OEIC ISA provider
Figure 3: Top ten unit trust/OEIC ISA providers, by value of funds under management, May 2014
Adspend for cash ISAs continues to decrease as adspend on stocks and shares ISAs increases
The consumer
A quarter of adults have an instant access cash ISA
Figure 4: Ownership of savings and investment products, June 2014
31% simply opted for the ISA that their current account provider was offering
Figure 5: Reasons to choose an ISA Provider, June 2014
Around a quarter of consumers use their ISA for unexpected...