Nationwide offers 5% interest rate plus £125 to switch to competitive savings offer | Personal finance | Finance
As a household name on the high street, Nationwide attracts thousands of savers each year due to its many savings options. One example is their FlexDirect account offering Brits 5% – an industry leading rate.
New apps are available from June 21 and the rate applies to balances up to £1,500 for the first 12 months.
Members may only take advantage of the interest-free introductory credit and overdraft interest rate offer once.
This means that anyone who previously held a FlexDirect account will not be eligible for the new rate.
However, if applicants previously held a single account, they will be eligible for the introductory rate on a joint account and vice versa.
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The building society has increased credit interest from 2% to 5% AER (4.89% gross) for new customers, but the rate is only available up to £1,500 for the first 12 months.
After 12 months, the account pays an AER variable of 0.25% (0.24% gross).
It can be opened online or in branch and customers will need to pay £1,000 per month, which does not include transfers from other Nationwide accounts or Visa credits.
Switchers can also get a switch incentive and earn extra money.
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With interest rates at 1.25% and inflation at 9%, any extra money could be vital to pay household bills as the cost of living crisis deepens.
Savers who switch current accounts will also be eligible for Nationwide’s switch incentive.
It offers £125 to existing members who make the switch and £100 to new customers.
To be eligible, transfers must be made from another provider using the Current Account Transfer Service (Cass) and at least two active direct debits must be transferred as part of the transfer to the new account.
Debbie Crosbie, Chief Executive of the Nationwide Building Society, said: “This market-leading rate will help new and existing members get the most out of their money, which is especially important at this time.
“The FlexDirect checking account also has an initial interest-free overdraft to give some peace of mind to those in financial difficulty and free them up to focus on paying off other debts.”
Nationwide said that by combining the £125 switch incentive with the £75 interest people could potentially receive from the 5 per cent interest rate, people could benefit from a £200 raise over the course of a year if they have at least £1,500 in their account over the next 12 months.
Interest-free overdraft for the first 12 months means eligible applicants can transfer their overdraft from their existing checking account provider or another Nationwide account.
After the first 12 months, the overdraft interest rate is 39.9% and the overdraft offered to someone will depend on individual circumstances.
On June 16, the construction company also launched two new accounts.
Start to Save number 2 has been introduced, which is an ordinary savings account. It offers savers a chance to win £250 in up to three raffles. Terms and conditions can be found on their website.
Additionally, the Member Online Bond has been introduced. It is a three-year fixed rate bond, available only to members of Nationwide. Members have either a current account, a mortgage or a savings account with them.
On July 1, Nationwide will raise interest rates on some of its savings accounts. People can find out more about accounts on the Nationwide website.