There is a huge amount of confusion over the growing number of different types of ISAs and this is becoming a barrier to savings, Skipton Building Society claimed.

The society’s own research indicated that many savers may have been missing out due to not understanding the rules and financial jargon associated with the new Personal Savings Allowance (PSA) and existing types of savings accounts.

Of the 2,000 people surveyed, almost half (47%) said they were confused by the rules associated with ISA accounts.

Kris Brewster, head of products at Skipton Building Society, said: “The savings landscape is becoming too complicated, especially with multiple types of ISA products.

“With the introduction of the new PSA this week and the Lifetime ISA, which the government has introduced to encourage people to save for the future, we believe these will add only more confusion and concern for consumers.

“We’d encourage the government to think about really helping savers by ending tax on all savings interest, and in doing so, abolishing the need for ISAs, putting an end to this confusion and creating a nation of lifetime savers.”

Over two fifths (44%) said they didn’t know what the maximum amount is they could put into an ISA and over a third (36%) didn’t know what the new PSA was.

A fifth (22%) stated they didn’t know how ISA differed from standard savings accounts, and one in ten (10%) said they didn’t even know what the acronyms ISA or PSA stood for.

Mr Brewster said: “It is clear from our research that the nation is confused when it comes to saving. With the different types of savings accounts out there it seems that this confusion is not only preventing people from making the most of their tax free savings options, for one in ten, it’s a barrier to saving - full stop.”