Shawbrook did not transfer my cash Isa and paid only 0.1% interest. Have you taken advantage of me?

I had a fixed rate Isa which expired with Shawbrook Bank earlier this month.

I chose to transfer to another provider and went through the usual transfer process, giving Shawbrook more than three weeks’ notice to make the transfer in time.

Basically, I wanted the money to hit the other account as soon as my relationship with Shawbrook ended.

However, Shawbrook decided not to process the transfer until my account had expired.

Then I discovered that my cash was earning only 0.1 percent interest. I contacted them again and was told I had up to 15 business days (three weeks) to make the transfer.

He said this was within FCA guidelines. Nothing I said over the phone would speed up the transfer or increase the rate I was paying for my funds.

Big banks have a bad reputation for customer service, but when I made a transfer from Halifax several years ago, they made the transfer quickly and even paid a decent interest rate on the day they held my funds.

Do you think this is taking advantage of captive Isa clients who have no choice if they want to maintain their tax-free status?

The sum involved is not huge in my case, but I am angry at the principle of the matter, especially when interest rates are much higher now. SC, via email

Harvey Dorset from This Is Money responds: When transferring an Isa, account holders have the option of requesting a transfer before its expiry date, thereby incurring a penalty, or waiting until the expiry date of their Isa before transferring it to a new provider.

The reasons for transferring an Isa can vary, but often it will be about moving somewhere where your money will get a better return, within the tax-free wrapper that Isas offer.

Overall, it’s worth looking for the best cash Isa deal, so your savings can generate the biggest possible return, without you having to do any heavy lifting.

When making a transfer, it is important to take into account the current rules so as not to incur that penalty.

On the other hand, transferring to a provider is a process that account holders will want to complete as soon as possible, in order to make the most of the benefits that Isas offer.

However, in your case, you were aware of the 15-day period that providers have to transfer your Isa and, as a result, requested the transfer three weeks in advance so that your Isa could be transferred immediately after the account expired.

The problem here is that if an Isa provider starts the transfer before expiry, it could be completed before then, triggering a breakage charge.

While the loss incurred during the transfer period at 0.1 percent interest is difficult to swallow, it would have been a noticeably bitter pill to swallow if he had been forced to pay a fine.

A Shawbrook spokesperson said: ‘The Isa transfer process begins on the day the Isa expires, ensuring exit charges are avoided, and all providers are required to complete the transfer within 15 working days.

“We have completed the transfer within this deadline for SC.”

Anna Bowes, co-founder of SavingsChampion responds: While maturing fixed rate cash Isas can be transferred before maturity, this will generally not happen, even if the application is submitted in advance, unless specifically requested by the policyholder, as it is likely There may be an early access charge from the existing provider, which could be quite hefty.

For example, early exit penalties can range from around 90 days of interest loss for a one-year Isa to 365 days for a five-year Isa, although there is no standard charge, so this is something to be expected. You should check when opening a fixed loan. Isaiah term.

Consequently, the transfer process and regulatory deadlines will normally begin when the old Isa matures.

And the customer should still earn some interest as the transfer progresses, but this will depend on the new and existing provider.

Some providers will transfer funds to a maturity account while waiting for the funds to be transferred, but the interest rate will vary so it is worth checking this.

And some providers, like Nationwide, will pay interest from the moment they receive a transfer request, even before they receive the money, so you could end up earning two lots of interest.

As seems to be the case with Isa rules and regulations, it can be a minefield, so unless you have the full picture, you could end up disappointed and not gain the interest you expect.

James Blower, founder of The Savings Guru, responds: The reason is that Shawbrook does not have full control of the process, so if you initiate the transfer immediately and then the new provider requests the funds before expiration, the customer will incur a non-compliance penalty.

I understand what your reader is trying to achieve here, but Shawbrook is damned if he does and damned if he doesn’t.

Your reader is angry that they didn’t do it right away and that he’s had a few days of interest at 0.1 percent, but he would also be angry if they had started it right away and the new provider took the funds on the 13th, causing him a penalty. due to breakage. Then they would be saying “why didn’t you wait?”