Santander has launched a competitive fixed Cash ISA with a 4.25% interest rate, along with the chance to claim a free £50 e-voucher. The interest rate is fixed for one year, and savers can launch the account with a minimum deposit of £500.

Fixed-rate Cash ISAs have gained popularity in the current high-interest rate environment, offering people living in the UK a way to save without paying tax on the interest earned, up to an annual limit of £20,000 for the 2025/26 tax year. Following the Bank of England's last Base Rate cut to 4.5%, savings interest rates have been on the decline. This makes fixed-rate accounts more attractive, as they lock in the interest for a set term, allowing savers to secure higher returns for longer.

Savers must be aged 18 or over to open the Santander account, and interest is paid once a year and at the end of the term.

The term starts on June 1, and deposits into the account can be made up to and including June 30, 2025. You can withdraw money, but you’ll have to close the account, and a charge equivalent to 120 days’ interest will be applied.

To get the £50 e-voucher, savers must transfer their full balance, a minimum of £10,000, from a non-Santander ISA.

But while Santander may be offering a competitive deal in the one-year fixed rate sector, it isn’t quite topping the table. Punjab National Bank takes the lead with an Annual Equivalent Rate (AER) of 4.35%.