The net increase was aided by exceptional unit trust sales for March, reaching pounds 1bn compared to pounds 566m the previous month. The monthly figures beat the previous record of pounds 975m achieved two years ago.
The figures, issued yesterday by the Association of Unit Trust and Investment Funds, the industry trade body, reflect a return to direct equity-linked investments after the sales collapse in 1994.
Autif's figures came as separate statistics by the Building Societies Association showed an outflow of pounds 279m in March.
Although on a seasonally-adjusted basis, net receipts reached pounds 116m in March, the figures this year were much lower compared with the same statistics for 12 months ago when net receipts totalled pounds 840m.
Peter Williams, head of research at the BSA, said: "The size of the outflow is likely to represent seasonal factors, as March is the latest date for investments in PEPs in order to fully exploit the tax advantages.
"Savers' interest in equity-based investments such as unit trusts may also have increased this and may have influenced the size of the outflow."
However, he pointed out that there was a growing trend for building societies to offer their own unit trust and PEP products. This meant that while money may have shifted out of deposit-style accounts a large slice of funds would still have remained with the societies under a different guise.
Philip Warland, director general at Autif, said: "Increased awareness of the benefits of unit trusts, together with a resurgence in overall investor confidence and tax year-end deadlines have spurred investors into action."
Mr Warland warned of the possibility of a future month-on-month tail- off in sales. He added: "The pattern of savings flows in the economy is very complex at the moment, with money being retained in building societies because of potential bonuses [from de-mutualisations].
"Maturing Tessas are also providing a source of new money flows. When that money is released and seeks higher returns, the flows into unit trusts will begin to rise again."
Autif's figures for the 1995/96 tax year mark an end to the shattering reverse unit trust investments and PEPs suffered 12 months previously.
Last month, PEP sales reached pounds 990m, more than double the previous month's total and pounds 149m more than the last all-time record of two years ago.
A substantial slice of PEP sales, pounds 369m, took place in the last few days before the end of the tax year on April 5, compared to pounds 225m in the same period a year earlier.
Three UK sectors, gilt and fixed interest; growth; and growth and income accounted for 60 per cent of the pounds 1bn in sales achieved in March.
Corporate bond PEPs, which were only launched last summer and regarded as a safer form of investment, continued to notch up higher sales reaching pounds 225m in March, up from pounds 165m in February.Reuse content