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Savings app Chip has increased its interestratein a new boost for savers. Chip Smart Cash ISA now pays 4.32% AER with a bonus rate of 0.57% AER for 12 months.

The account is a flexible Cash ISA, meaning savers can withdraw and replace money in the same tax year without affecting their annual £20,000 ISA allowance. Interest is tax-free, calculated daily and paid annually, although unpaid interest is forfeited if the account is closed or transferred before the anniversary. Commenting on the deal, Caitlyn Eastell, personal finance analyst at Moneyfactscompare.co.uk, said: "This week, Chip has increased and added a boosted rate on its Chip Smart Cash ISA.

"The rise sees the account take the number one spot when compared to its peers and now pays an attractive 4.32% AER, however, this includes a 0.57% AER bonus for the first 12 months, so it's important savers review once it expires."

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Chip says withdrawals can be made as often as needed, with funds arriving the next working day. Eligible deposits are FSCS protected up to £120,000.

To be eligible for the Boosted Cash ISA Promotional Rate, you must be a new Chip customer.

Ms Eastell added: "Adding to its appeal, Chip's Smart Cash ISA has an underlying gross rate guaranteed to be equal to Bank Base Rate.

"While savers can invest as little as £1 and add to the account at any time, if they wish to close the account or transfer out before the first anniversary, they will not receive their interest payment, which should be considered.

"Investors have the choice between holding a fee-free subscription or paying a £4.99 fee per 28-days for a ChipX subscription which gives them wider or exclusive access to some features. The deal secures an Excellent Moneyfacts product rating."

However, savers should remember the headline rate is variable and includes a temporary 12-month boost, meaning returns could fall after the first year or if Chip changes the rate.

As with any savings product, it is worth comparing the deal against other cash ISAs and checking withdrawal times, transfer rules and protection limits before moving money.