But it no longer means the interest rate the account pays is reasonable given market conditions. To make the CAT standard, a mini cash Isa only has to pay a rate of interest that is not lower than two per cent below bank base rates.Before taking out a mini cash Isa, you should consider whether you want to invest in shares within a tax-free Isa wrapper in the same tax year. If you have a mini cash Isa, under the Isa rules, you are not allowed to have a maxi Isa as well. This means that you would only be permitted to take out a mini stocks and shares Isa in addition to your mini cash Isa. For these, the stocks and shares annual limit is £4,000 lower than it is for maxi Isas.Because they give tax-free interest, cash Isas give you a higher return on your cash than regular bank and building society accounts. But anyone looking to build up long-term savings, should consider investing in shares instead of cash, financial advisers say.The recent dramatic falls witnessed on world stockmarkets have put many would-be investors off. But historically, equities or shares have generated far higher returns over the medium to long-term than cash.rachelfixsen compuserve Chase de Vere: 01225 469371; Fiona Price & Partners: 020 7611 4700.

For the second week running the banks have had to explain why they are not doing more to help those who get into financial difficulties. Last week it was over the report into the problems the poor have in obtaining credit. This time it is a damning inquiry into financial illiteracy by the National Association of Citizens Advice Bureaux, which shows how the unwary can be suckered into to overpaying for financial services. Moneynetsavingssearch For the second week running the banks have had to explain why they are not doing more to help those who get into financial difficulties.

Retailers, particularly of cars and electrical goods, do not come out well, either. But banks are at the hub of the financial system, yet they appear to have done very little to combat financial illiteracy and come up with clever ideas to help the disadvantaged. There have been some excellent initiatives, notably NatWest’s work in schools, which should bear fruit as a new generation enters the workforce armed with more nouse than their predecessors.Nevertheless, the Nacab study vividly demonstrates the in-built bias in favour of banks and other providers and against the customer. If you fail to pay your credit card bill on time, the interest charges kick in automatically, but if a bank or insurer absent-mindedly leaves a cheque in your favour lying around for a few days there is nothing automatic about you receiving the missing interest. Assuming you discover something is amiss, you have to chase the company for compensation and in many cases customers feel it is not worth the effort.One reason why financial providers of all sorts must make greater efforts on the public’s behalf is that they have asked us to trust them, and in most cases we do just that They judge us and we generally accept their judgements. When we are let down we are mere individuals fighting mighty machinesALTHOUGH IT is outside Ms Arnott’s remit, the FSA should not forget that financial education begins on its own doorstep. For all the exams they have to pass these days, financial practitioners are not always as clued up as they might be about the nuances of their own industry.I had the opportunity this week to test how familiar leading fund managers were with the argument that past performance is irrelevant in making investment choices – a controversial concept, but one to which the FSA is officially wedded and has made plain its stance on several occasions.You would have thought I was suggesting their mothers should walk naked down the nearest high street, so vehement was the reaction from these representatives of Invesco, Britain’s second biggest retail fund manager.