Net outflow of share ISAs

British investors are snubbing stocks and shares ISAs, with more people taking their money out than putting it in, according to figures published today.

It is the first time since their introduction in April 1999 that ISA sales saw a net outflow, said the Investment Management Association.

The net outflow of £23.5m (€33.75m) last month followed what had been the lowest recorded inflow of £25m (€35.9m) in August.

And despite warnings that people are not saving enough, the third quarter of the year saw the total number of regular savings plans fall to 1.56 million from 1.6 million in quarter two.

ISA plans also fell in quarter three to 1.3 million, a 2% fall from the previous quarter.

Richard Saunders, chief executive of IMA, said: “Despite stronger markets in September, investor confidence remains low. The first net outflow that we have recorded from ISAs shows that efforts to attract investors back to the market are not yet succeeding.

“The reasons are many and complex, but are likely to include continuing uncertainty about investment prospects, higher interest rates and the reduced tax benefits associated with ISAs.”