Nationwide is offering people who switch their current account a £175 signing on bonus as the battle between high street giants to win customers heats up. It is one of a series of perks including a £50 buffer that will allow customers to go into the red without incurring overdraft charges.
Customers who sign up to the FlexDirect account, which pays interest at 5 percent AER, will earn 1 percent cashback on debit card spending. It is the latest move from Britain’s biggest society to take advantage of its status as a mutual organisation.
Basically, that means it is run on behalf of its customers as opposed to the banks which serve shareholder interests. Previously, it announced it a £100 Fairer Share giveaway.
That was for customers who had a qualifying current account and either £100 in a Nationwide Savings account or £100 left on a mortgage. The last time Nationwide offered a £175 switching perk it signed up a record number of new customers and triggered a race by rivals to offer similar incentives.
Tom Riley, Director of Retail at Nationwide, said: “We want to give people every reason to join Nationwide. Our new incentives are the latest demonstration of how we are making banking more rewarding for customers. We believe this shows the difference of being part of a modern mutual, which reinvests it profits for the benefit of members and customers, not shareholders.”
How to qualify for the £175 perk
Customers must complete a full switch using the Current Account Switch Service. A minimum of two active Direct Debits must be transferred to the new account as part of the switch. Customers must also deposit £1,000 and make one debit card payment within 31 days.
How to open the account
A new account must be opened via Nationwide’s website, Internet Bank or Mobile Banking App. The switch must be requested as part of the application.
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Existing customers can also switch a current account they hold with another provider to an existing account they hold with Nationwide via the Internet Bank. The switch must be completed within 28 days of it being requested.
Customers can switch to one of the Society’s three main current accounts:
- FlexPlus: a market-leading packaged account with benefits including worldwide family travel insurance, mobile phone insurance, UK and European breakdown cover and commission-free usage abroad for £13 per month7.
- FlexDirect: an online account paying 5% AER credit interest and offering 1% cashback on debit card spend.
- FlexAccount: an everyday bank account where customers can bank online and in branch for no fee.
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Cashback
Customers who open a FlexDirect account and haven’t benefitted from a previous FlexDirect incentive will also receive 1 percent cashback (capped at £5 per month) for the first 12 months on debit card spend alongside receiving a market-leading 5 per cent AER credit interest on balances up to £1,500 for the first 12 months.
Overdrafts
In November, Nationwide is launching a £50 interest free buffer to support new and existing customers who may occasionally dip into their overdraft. The buffer will apply to overdrafts on all the Society’s three main current accounts (FlexPlus, FlexDirect and FlexAccount) and will reduce the representative APR to 38.2 per cent. The introductory overdraft offer on FlexDirect will be withdrawn for new account openings and replaced by cashback. There will be no change for existing FlexDirect customers already benefiting from an existing offer.