Money Insider: Nationwide rewards its loyal customers

The competition for current account business on the high street is as intense as ever, with financial incentives and preferential deals often being used as bait. With the talk of Virgin Money entering the fray and the likes of Metro Bank expanding, the battle for new accounts is likely to become much tougher.

In the last couple of years there has been more emphasis on trying to retain existing customers; a sensible move – after all, there's not much point in spending a fortune on advertising and marketing to get people through the door, only to then ignore their needs and see them leave for one of your rivals.

Nationwide Building Society has focused on the loyal customer strategy for some time now, and it seems the message is getting through, as the UK's largest mutual attracted over 350,000 new current account customers last year.

This week we saw further good news for Nationwide customers in the form of a best-buy loan rate and a new 7-day notice savings account.

The personal loan deal offers existing customers a rate of just 6.7 per cent APR on loans between £7,500 and £15,000 until 5 July, the lowest rate the mutual has offered since early 2007.

For savers, Nationwide has introduced a new branch-based 7-day deposit account which will pay at least 1.75% above base rate, so currently offering a return of 2.25 per cent. There are higher-paying instant access accounts available, paying up to 3 per cent, but most of these include a 12-month introductory bonus.

It's good to see that existing members are being well looked after, a refreshing change from many deals where the best deals are saved for new customers only.

Mortgage providers offering greater switching flexibility

Uncertainty regarding future interest rate rises has been one of the main factors stopping people from committing to a new mortgage deal when their existing arrangement expires.

Remortgage business has been slow, but increasingly lenders are offering greater flexibility to try to tempt borrowers to sign up for a new deal.

Last October, Barclays, under its Woolwich brand, launched the "Switch and Fix" product range, which allows customers to take advantage of low tracker interest rates now but with the option of switching to a fixed rate mortgage at a later date without incurring an early repayment charge.

Other lenders have followed this trend, and in the last couple of weeks, Yorkshire Building Society and Coventry Building Society have launched their own initiatives.

Yorkshire Building Society has entered the "Drop Lock" mortgage market with two new tracker products priced at 2.29 per cent and 2.49 per cent variable, lower than any standard variable rate (SVR) currently available.

The beauty of this deal is that if the Bank of England Base Rate remains low, then the borrower can choose to remain on their tracker product, and thus take advantage of the low interest rate, but if rates look set to increase they can switch to a fixed rate product without charge.

Borrowers who may be uncertain as to what the future may bring on interest rates also have a new option with the Coventry Building Society "Flexx for term" products. The unique angle with this offer is that unlike some switching packages, where the choice of products may be restricted, with "Flexx for term" you can transfer to any other product including capped rate and base rate trackers as well as short and long term fixed rate mortgages.

Barclays' flexible bond catches the eye

it has been a busy week for new product launches, many of which have being distinctly average, however there were a few new deals that caught my eye.

Barclays launched a two-year flexible savings bond paying 3.2 per cent for 2 years (3.5 per cent on balances of over £50,000). While the rate falls well short of the 4 per cent rate on the standard 2-year fixed bonds from Kent Reliance Building Society and Santander, it does offer a degree of flexibility, with 30 per cent of the capital available for withdrawal without charge if required.

Coventry Building Society has relaunched its popular eNotice online savings account, paying a very competitive 3.05 per cent gross/AER with just 30 days' notice required for withdrawals. The rate does include a bonus for the first year, but this is just 0.5 per cent, far lower than some competitor products, where the bonus accounts for the majority of the overall rate.

Leeds Building Society is offering a new online access account, paying a market-leading rate of 3.05 per cent. The Online Access Account (Issue 4) permits unlimited withdrawals at any time, without notice or penalty. It pays a variable rate of 2.05 per cent, plus an additional bonus of 1 per cent, which expires on 31 January 2012.

Andrew Hagger – Moneynet.co.uk

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Guru Careers: Pricing Analyst

    £30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...

    Guru Careers: C# Project Team Lead

    £55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...

    Day In a Page

    Fifa corruption: The 161-page dossier that exposes the organisation's dark heart

    The 161-page dossier that exposes Fifa's dark heart

    How did a group of corrupt officials turn football’s governing body into what was, in essence, a criminal enterprise? Chris Green and David Connett reveal all
    Mediterranean migrant crisis: 'If Europe thinks bombing boats will stop smuggling, it will not. We will defend ourselves,' says Tripoli PM

    Exclusive interview with Tripoli PM Khalifa al-Ghweil

    'If Europe thinks bombing boats will stop smuggling, it will not. We will defend ourselves'
    Raymond Chandler's Los Angeles: How the author foretold the Californian water crisis

    Raymond Chandler's Los Angeles

    How the author foretold the Californian water crisis
    Chinese artist who posted funny image of President Xi Jinping facing five years in prison as authorities crackdown on dissent in the arts

    Art attack

    Chinese artist who posted funny image of President Xi Jinping facing five years in prison
    Marc Jacobs is putting Cher in the limelight as the face of his latest campaign

    Cher is the new face of Marc Jacobs

    Alexander Fury explains why designers are turning to august stars to front their lines
    Parents of six-year-old who beat leukaemia plan to climb Ben Nevis for cancer charity

    'I'm climbing Ben Nevis for my daughter'

    Karen Attwood's young daughter Yasmin beat cancer. Now her family is about to take on a new challenge - scaling Ben Nevis to help other children
    10 best wedding gift ideas

    It's that time of year again... 10 best wedding gift ideas

    Forget that fancy toaster, we've gone off-list to find memorable gifts that will last a lifetime
    Paul Scholes column: With the Premier League over for another year, here are my end of season awards

    Paul Scholes column

    With the Premier League over for another year, here are my end of season awards
    Heysel disaster 30th anniversary: Liverpool have seen too much tragedy to forget fateful day in Belgium

    Liverpool have seen too much tragedy to forget Heysel

    Thirty years ago, 39 fans waiting to watch a European Cup final died as a result of a fatal cocktail of circumstances. Ian Herbert looks at how a club dealt with this tragedy
    Amir Khan vs Chris Algieri: Khan’s audition for Floyd Mayweather may turn into a no-win situation, says Frank Warren

    Khan’s audition for Mayweather may turn into a no-win situation

    The Bolton fighter could be damned if he dazzles and damned if he doesn’t against Algieri, the man last seen being decked six times by Pacquiao, says Frank Warren
    Blundering Tony Blair quits as Middle East peace envoy – only Israel will miss him

    Blundering Blair quits as Middle East peace envoy – only Israel will miss him

    For Arabs – and for Britons who lost their loved ones in his shambolic war in Iraq – his appointment was an insult, says Robert Fisk
    Fifa corruption arrests: All hail the Feds for riding to football's rescue

    Fifa corruption arrests

    All hail the Feds for riding to football's rescue, says Ian Herbert
    Isis in Syria: The Kurdish enclave still resisting the tyranny of President Assad and militant fighters

    The Kurdish enclave still resisting the tyranny of Assad and Isis

    In Syrian Kurdish cantons along the Turkish border, the progressive aims of the 2011 uprising are being enacted despite the war. Patrick Cockburn returns to Amuda
    How I survived Cambodia's Killing Fields: Acclaimed surgeon SreyRam Kuy celebrates her mother's determination to escape the US

    How I survived Cambodia's Killing Fields

    Acclaimed surgeon SreyRam Kuy celebrates her mother's determination to escape to the US
    Stephen Mangan interview: From posh buffoon to pregnant dad, the actor has quite a range

    How Stephen Mangan got his range

    Posh buffoon, hapless writer, pregnant dad - Mangan is certainly a versatile actor