Halifax to cut rate on its popular table-topping Junior Isa by a third from January

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Child savers with cash in the Halifax Junior Isa will suffer a whopping rate cut from 6 per cent to 4 per cent on January 15 next year.

The table-topping rate was paid to children under 16, whose parents also had a cash Isa with the bank, and who opened an account before July. 

A Halifax spokesman says: ‘Our Junior Isa, which has consistently led the industry since its launch more than two years ago, continues to offer the highest interest rate available for this product.’

Junior Isa: Halifax is cutting the rate from 6 per cent to 4 per cent from January next year

Children whose parents do not have a cash Isa with the bank earn 3 per cent. Adults can put up to £4,000 into a Junior Isa for children - if they do not have a child trust fund.

Meanwhile, there is good news for those with child trust funds. HMRC has launched a consultation into transferring funds into Junior Isas. 

Around six million children born from September 2002 to January 2011 have a child trust fund - but they have been outperformed by Jisas.

From April 2015, parents will be able to move CTF savings to a Junior Isa, giving older account holders at least six more years of growth until the account matures.