It comes as banks and building societies increasingly look for different ways to help their customers during the cost of living crisis. One of the main causes of the economic slowdown is the skyrocketing rate of inflation, which recently hit a 40-year high of 9.1%. With inflation hurting people’s savings, financial institutions, such as Nationwide, are responding by raising rates on its entire slate of savings products.
Last month, Nationwide raised the introductory credit interest rate on its FlexDirect checking account to five percent.
It is estimated that this move by the building society will help members up to £200 within a year if they switch to their services.
Individuals who have chosen to switch to Nationwide’s FlexDirect will also benefit from the financial institution switching incentive.
This deal gives £125 to existing members who transfer their current account to the building society and £100 to new customers.
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Debbie Crosbie, chief executive of the building society, explained why interest rates are being raised so much amid the cost of living crisis.
Ms Crosbie said: “Being able to offer very competitive rates is one of the greatest benefits of mutuality.
“This market-leading rate will help new and existing members get the most out of their money, which is especially important right now.
“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.”
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However, the five per cent interest rate for Nationwide’s FlexDirect checking account isn’t the only increased rate the construction company has implemented.
The construction company has also launched a new issue of its popular Triple Access Online Saver which has an interest rate of 1.40%.
Under this savings account, Nationwide allows three withdrawals within the 12 month period.
However, any further withdrawals will reduce the interest rate to 0.10% for the rest of the period.
Tom Riley, director of banking and savings at Nationwide, highlighted why the construction company’s latest moves are aimed at giving its customers “peace of mind”.
Mr. Riley explained, “Many savers like to put at least a portion of their savings in an instant access account to have peace of mind knowing they can access the funds if they need them.
“The new issue of our Triple Access Saver account pays one of the highest rates on the market and will appeal to those looking to save with a brand they know and trust.
“We are always looking to offer a wide range of accounts to meet the different needs of our members, which is why we have also increased rates for those who do not need immediate access and want to save in a bond. fixed rate or ISA.”