Nationwide nudges easy-access savings rates only slightly, despite three base rate hikes: Is Britain’s biggest mutual being fair to savers?
- Nationwide upping its instant access savings accounts from 1 May
- Previously savers had earned between 0.01% and 0.05% from these accounts
- This is Money’s editor calls on Nationwide to stop insulting its customers
- He also suggests savers return the gesture by moving their money elsewhere
Savings rates have started to head higher in recent months, thanks to three base rate rises in quick succession and challengers boosting competition.
But despite many of the big boys hiking mortgages rates quickly, the same cannot be said for savings deals.
This week, Nationwide revealed a round of savings rises to take effect from Sunday.
Britain’s biggest building society will nudge rates on all its easy-access accounts, including its Instant Access Saver and Instant Isa Saver, by 0.1 percentage points to either 0.11 per cent, 0.13 per cent or 0.15 per cent depending on the amount saved in the account.
In his weekly column, This is Money’s editor, Simon Lambert said: ‘Come on Nationwide, stop insulting your customers, you can do better than this.’
This means those holding £10,000 in Nationwide Instant Access can expect to see their annual return grow from £1 to £11.
HSBC, Lloyds Bank, NatWest are also examples of banks that have recently upped their 0.01 per cent easy-access rates to just 0.1 per cent.
TSB and Halifax have both gone a little higher offering savers 0.15 per cent for using their easy-access savings accounts, whilst Barclays hasn’t even bothered – its Everyday Saver continues to pay 0.01 per cent.
That’s despite base rate rising from 0.1 per cent in December to 0.75 per cent today.
In his weekly column, This is Money’s editor, Simon Lambert, referred to these types of accounts as insult accounts.
‘These are the legacy savings accounts paying such a pitiful rate of interest that to do so is an insult,’ said Lambert, ‘it would be better to not get any interest at all.’
‘Come on Nationwide, stop insulting your customers, you can do better than this.’
There are a number challenger easy-access savings providers that are paying ten times more than Nationwide’s accounts – even after its latest rate rises.
Chase Bank is offering customers access to a linked savings account paying 1.5 per cent on balances up to £250,000.
Just like Nationwide’s Instant access account, savers can access their savings as often as they like, with no fees, charges or loss of interest.
Meanwhile, challengers Cynergy and Zopa bank are both paying 1.2 per cent to their easy-access savers.
Amidst a cost of living crisis and peoples finances being squeezed from every direction it is arguably more important than ever to make your money work harder.
The consumer Prices Index inflation hit 7 per cent in March – meaning many savers will feel wherever they store their spare cash, they’ll still be becoming poorer in real terms.
However, most will agree that being made 6.99 per cent poorer is much worse than being 5.5 per cent poorer.
For anyone fed up with being insulted by their bank or building society, limiting the damage should be enough of an incentive to jump ship.
This is Money’s editor, Simon Lambert, suggests that customers who have their cash vegetating in these types of accounts return the gesture and move their money elsewhere.
He added: ‘It’s tempting to just throw your hands up and say what’s the point, but the answer is not to just decide it’s too hard and give up.
‘As a famous supermarket once said, every little helps.
‘Nobody likes to lose 5 per cent, but it’s better than losing 7 per cent. And that’s what will happen if you just keep your cash sitting in what I call your bank or building societies’ Insult Account.
‘So, if you do one financial thing this week, sort your savings out.’
Nationwide is also boosting the rates on some other products by a larger margin, but still nowhere near the 0.65 percentage point change in base rate.
Two of its Isas are rising 0.25 percentage points to pay 0.5 per cent and a number of other accounts will see rises between 0.1 and 0.15 percentage points.
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