Lloyds Announce new Junior Cash ISA

Lloyds TSB is set to become the first major high street bank to offer a Junior Cash ISA .
The new long-term savings product will be available from 13th February 2012, and will be offered at a tax free flat rate of 3 per cent AER.
According to comparison website Moneyfacts, the average Junior ISA rate is currently 2.63 per cent, making the new account from Lloyds a competitive deal.
Junior ISAs were launched last autumn as part of a Government campaign to strengthen the nation’s savings culture. They have been hailed as having the potential to be the most successful children’s savings scheme ever, with parents able to lock away up to £3,600 a year tax free for their child’s future.
Greg Coughlan, head of savings for Lloyds TSB, said: “Saving for a child’s future is increasingly important as more and more young adults are becoming reliant on their parents to fund some of the most basic costs of living.”
“The Junior ISA allows parents to set aside money throughout their child’s life in a tax efficient way, building that all important nest egg which could either help fund their university education or help them take that first step on the property ladder.”
“We are delighted to be the first of the major high street banks to announce such an account for customers.”
However, Coughlan added that the Government “needs to urgently review its policy of restricting access to the Junior ISA market for those that were eligible for a Child Trust Fund” so that parents can get the “maximum choice” of savings deals .
The launch of the new ISA comes as research from the bank shows that young adults in the UK are increasingly reliant on parents for financial support.