Lightyear's highly anticipated entrance to the ISA market won't disappoint the UK customers on the waiting list. Simple and user friendly, both of Lightyear’s ISAs come with no withdrawal penalties (such as surprise rate drops after you withdraw), no minimum deposit, and ultimate flexibility – the ability to pay in and out without losing your annual allowance.

Over 70% of ISA holders use traditional banks and brokers for their ISAs; just a small proportion use fintechs and neobrokers. Lightyear is launching its ISAs to compete with the legacy providers – but offering lower fees, more flexibility, higher rates, and fewer caveats.

Lightyear’s stocks & shares ISA

The Stocks & Shares ISA has the same pricing that Lightyear customers currently enjoy on their general investment accounts: no execution fees for ETFs, up to £/$/€1 max per trade and a 0.35% FX fee if you invest outside GBP. Customers can also earn 4.84% AER interest (as of 20th January 2025, variable) in their Stocks & Shares ISA through Lightyear’s popular ‘Vaults’ product, where money is invested in BlackRock money market funds.

There are no account, subscription, or custody fees in the ISA. When Lightyear surveyed stocks and shares ISA holders in the UK, 77% found low fees important. In Lightyear’s own customer survey, ‘no subscription fee’ ranked as the most important feature by those with Stocks & Shares ISAs.

New exclusive research published – conducted by the independent macroeconomic research firm Capital Economics and commissioned by Lightyear – reveals that Lightyear’s product is 10x cheaper than the market average over 10 years.

Lightyear’s Cash ISAs

The company’s Cash ISA pays 4.75% AER – it matches the Bank of England rate so customers always know what they’re getting. Moving away from gimmicks and bonus rates that disappear, Lightyear's Cash ISA is here to stop savers having to endlessly rate shop around or worry about surprise rate drops if they need to withdraw some funds.

Lightyear’s survey on its own customers, showed that the most important feature for a cash ISA was the interest rate, with 97% of respondents with Cash ISAs selecting this as important.

Wander Rutgers, COO and UK CEO at Lightyear: “We’re launching ISAs today to help everyone in the UK find financial freedom faster. At the moment the market is a lottery: most Brits sleepwalk into this lottery by opening an ISA with whoever they’ve been banking with since they were a kid. There’s a real herd mentality where everyone believes the right thing is to save and invest with an incumbent bank or broker, which means people rarely shop around and just accept whatever rate they’re given or whatever fee they’re hit with. So their money goes straight into the pockets of the providers, instead of to them. As for the minority using the newer fintech options; they’re still entering a lottery. You can bet these providers are cross-subsidising their too-good-to-be-true ISAs with gambling-like products, raising red flags about their sustainability strategies as they're relying on revenue from betting against their customers.

“Lightyear is firmly against this ‘casino-style’ approach. Our new ISAs are suited for customers using the high street banks and brokers, but the key difference: a delightful experience, no unfair fees, and fair interest.”

Adrian Radu, partner at global VC Lightspeed, an investor in Lightyear, said: “Financial markets are still full of unfair fees that slow down people wanting to build their wealth. Lightyear’s growth has been impressive since we invested in them in 2022, and their launch of ISAs today is going to accelerate this rapidly. Lightyear is fixing the wealth gap by providing products that prioritise customer needs, something which a lot of traditional finance institutions greedily ignore.”

Luigi Brambilla, Managing Director, Investments and Capital Markets at Virgin Group, adds: “Lightyear’s growth has been impressive since Virgin invested in 2022 and we’re pleased to see the brand continue to expand its offering for UK customers.”

To start 2025 with a bang, Lightyear is re-launching its UK business for both consumers and businesses with FSCS protection and ISAs. UK residents can sign up to Lightyear UK and open a general investment account, a business account, a Stocks & Shares ISA as well as a Cash ISA. ISA holders can also transfer holdings over to Lightyear.

Since launch, Lightyear has raised over $35 million from a range of top venture capital firms and individual investors including Virgin Group and Lightspeed Venture Partners, and expanded across 22 markets in Europe. It received direct authorisation from the Financial Conduct Authority (FCA) in September 2024, and spent the past few months getting ISAs ready before the end of the UK tax year – which closes on the 6th April 2025.