How does the Cash Lifetime ISA bonus interest rate work?

If you signed up for a Moneybox Cash Lifetime ISA on or after 17th August 2020, your account has an underlying AER variable interest rate, as well as an introductory bonus interest rate, which is paid out after your account has been open for 12 months.

For new customers, this interest rate is 4.50% AER (variable), which includes an introductory bonus interest rate of 1.70%, which is paid out after 12 months.

The 2.80% AER variable interest rate is calculated daily and added to your LISA balance on the first working day of the month.

The 1.70% introductory bonus interest rate is calculated daily, and, rather than being paid out monthly, will be paid into your LISA once your account has been open with Moneybox for 12 months. Once your Cash LISA has been open for 12 months and you have received your bonus interest payment, only the variable interest rate, currently 2.80% AER variable, and the 25% government bonus will apply to the account going forward.

If you cancel your Moneybox Cash Lifetime ISA or transfer out to another provider during the first 12 months, you will no longer be eligible and won’t receive the introductory bonus interest. If you make a penalty withdrawal and have a balance of £0 at the end of the offer period, you won’t be eligible to receive the bonus interest. A penalty withdrawal is any withdrawal from your LISA which is not for a qualifying first home purchase or retirement after age 60, excluding if you are terminally ill with less than 12 months to live.