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Nationwide is offering 5% interest on a current account in the fight for depositors

The major current account provider is offering 5 per cent interest on balances of up to £ 1,500 for the first 12 months as the battle for customer engagement erupts.

Previously, the Nationwide Building Society offered 2 per cent fixed for 12 months on a balance of up to £ 1,500 in its FlexDirect account, but this more than doubled the bid rate to 5 per cent AER (annual equivalent).

A 5 percent initial rate is available for new applications opened June 21. After 12 months, 0.25% AER is paid to the account.

Participants can take advantage of the initial loan interest rate and the interest-free overdraft offer only once, which means that anyone who previously had a FlexDirect account will not be eligible for the new rate.

However, if applicants previously had only one account, they will be eligible for the entry rate for the joint account and vice versa.

Participants will be required to pay £ 1,000 per month, excluding transfers from other national accounts or Visa credits.

Those who switch their current account can also benefit from the Society’s incentive, which pays £ 125 to existing members who switch their current account to the Society, and £ 100 to new customers.

To qualify, you must switch from another provider using the Current Account Switching Service (Cass), and at least two active direct debit funds must be transferred as part of the transition to a new account.

Debbie Crosby, executive director of the Nationwide Building Society, said: “This market-leading course will help new and existing members make the most of their money, which is especially important now.

“The FlexDirect current account also has an introductory interest-free overdraft to give some peace of mind to those in financial difficulty and release them to focus on repaying other debts.”

Nationwide said that by combining a £ 125 incentive with a £ 75 interest rate that people could potentially get from a 5 per cent rate, people could benefit from a £ 200 increase during the year if they have at least for a £ 1,500 bill over the next 12 months.

An interest-free overdraft for the first 12 months means that eligible applicants can switch their overdraft from their existing current account provider or other nationwide account.

After the first 12 months, the overdraft interest rate is 39.9 percent, and the overdraft offered to someone in the first place will depend on individual circumstances.

Rachel Springal, a spokeswoman for Moneyfacts.co.uk, said: “It is interesting to see that Nationwide is offering a market-leading current account interest rate that can encourage consumers combined with a monetary incentive to change.”

She added: “It will be interesting to see if any of the competitors consider their current interest rate proposals in the coming weeks.

“Due to the consistent increase in the base rate, some vendors are adjusting interest rates on the current account, such as Santander.

“Consumers will find that Virgin Money pays 2.02 per cent AER / 2 per cent gross on balances up to £ 1,000 and also offers attractive pegged savings.

“Elsewhere, Halifax will pay a monthly reward of £ 5 to its current account so consumers can earn up to £ 60 a year on this option.

“Those consumers who compare cash with upfront switching will find more generous free money elsewhere, such as HSBC (£ 170) and the first direct (£ 150).

“When comparing current accounts, it is very important that consumers take into account both any benefits and fees charged to ensure that they meet their banking needs.”

Nationwide is offering 5% interest on a current account in the fight for depositors

Source link Nationwide is offering 5% interest on a current account in the fight for depositors

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