From 1 March 2013, Nationwide's FlexDirect current account will pay a market-leading rate for credit interest of 5% AER fixed for the first year on credit balances up to £2,500. After the first year, the account pays 1% gross p.a./AER (variable) on credit balances up to £2,500.
Customers requiring an overdraft will benefit from the introductory offer of no arranged overdraft charges for 12-months, after which a reduced daily usage charge of 50p will apply on arranged overdrafts of £10 or more.
Existing FlexDirect customers will see the credit interest on their account increased to 5% AER for an additional 12-months, not just for the remainder of their initial introductory term. These customers will also benefit from the introductory overdraft offer of no arranged overdraft usage charges for the 12 month period.
FlexDirect requires minimum monthly funding of at least £1,0001. The self-service account can be opened in branch, online or by telephone, but customers will be required to use Nationwide's online, mobile and telephone banks to carry out day-to-day transactions on their account. FlexDirect customers also have access to:
- Nationwide's range of 'Flexclusives' including exclusive savings, mortgages, credit cards and personal loan deals
- Simply Rewards – a website offering discounts on a range of products and services from top consumer brands
Switching current accounts is easier than people think. Nationwide has a dedicated team which switches customer's direct debits and standing orders for them. Customers are kept informed of progress via text updates.
Phil Smith, Nationwide's head of current accounts, said: "Nationwide continues to see record numbers of customers switching to the Society as people continue to look for a credible alternative to the big banks.
"FlexDirect offers a market-leading credit interest rate of 5% AER, a rate that is likely to hold wide appeal in a market where many current accounts pay little or no interest.
"As a demonstration that Nationwide is "On Your Side", existing FlexDirect customers will not miss out. The market-leading credit interest rate and introductory overdraft offer will be reset on their accounts for an additional 12-months."
How FlexDirect's credit interest compares against the big banks:
Source: Competitor websites and Nationwide – 22.2.2013
||Credit Interest Rate
||Net interest earned on £2,500 per annum
|Nationwide Building Society
||5% AER (for 12 months)
||£5 per month
||123 Current Account
||Up to 3% AER
||£2 per month (£24 per annum)
||Classic with Vantage
||Up to 3% AER
|Royal Bank of Scotland
Notes to editors:
1Minimum monthly funding of £1,000 excludes internal transfers.
- FlexDirect is open to new and existing customers aged 18 years and over
- Minimum monthly funding of £1,000 (excluding internal transfers).
- Single and joint account options available
- FlexDirect can be opened online, by telephone and in branch
- The account is operated using online or telephone banking
- 5% AER (4.89% gross p.a.) fixed is payable for the first 12 months on balances up to £2,500. After 12 months the account pays 1% gross p.a./AER (variable) on balances up to £2,500
- Interest is paid monthly
- Credit interest is not payable on balances over £2,500
Overdraft daily usage fees
- Arranged overdrafts: 50p per day
- Arranged overdraft buffer of £10. No overdraft charges apply on arranged overdrafts of less than £10
- Unarranged overdrafts: Fee free buffer of £10
- Unarranged overdrafts of over £10: £5 per day, capped at £60 per month
- Paid and unpaid item fees: £5 each, capped at £35 per month
- Total unarranged overdraft charges capped at £95 per month
Exclusive deals available to reward FlexDirect customers, including:
- Exclusive credit card: The Nationwide Select Credit Card offers commission-free purchases abroad, unlimited cashback on all sterling purchases and introductory offers for purchases and balance transfers. 12.9% APR Representative (variable)
- Access to our lowest personal loan rate: Currently 5.9% APR Representative for loans £7,500 to £14,999 for up to five years
- Exclusive mortgage offers: Exclusive access to our Flexible five year tracker mortgage, with no product fee, no Early Repayment Charges, and free standard legal and valuation fees. Enjoy the peace of mind of a four year fixed rate, exclusively for main FlexAccount customers (early repayment charges apply). A £99 non-refundable booking fee is payable up front for both mortgages
- Preferential savings rates: Our Flexclusive savings accounts have been created exclusively for main current account customers
- Exclusive discount on car insurance: £50 off car insurance when buying a new policy (terms and conditions apply) Rated 5 Star by Defaqto with up to 75% no claim discount as well as a courtesy car as standard even if your car is written off or stolen (excludes third party only policies)
Customers also have access to Simply Rewards – A website exclusively for Nationwide debit card and credit card customers, offering discounts on top brands.
AER Stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year.The gross rate of interest is the interest rate payable before any income tax is deducted (if you do pay tax).The net rate of interest is the interest payable after any income tax is deducted (if you do pay tax).
Nationwide is the world's largest building society as well as the second largest savings provider and a top-three provider of mortgages in the UK. It is also a major provider of current accounts, credit cards, ISAs and personal loans. Nationwide has around 15 million customers.
Customers can manage their finances in a branch, on the telephone, internet and post. The Society has around 16,000 employees. Nationwide's head office is in Swindon with administration centres based in Northampton, Bournemouth and Dunfermline. The Society also has a number of call centres across the UK.