Nationwide Building Society has announced it will slash interest rates across 36 savings products.
The reductions follow the Bank of England’s decision to lower the base rate from four per cent to 3.75 per cent in December.
Governor Andrew Bailey indicated that inflation had moved past its recent peak and continued to decline, enabling the Monetary Policy Committee to reduce borrowing costs.
“We still think rates are on a gradual path downward,” Mr Bailey stated. “But with every cut we make, how much further we go becomes a closer call.”
Customers will experience rate decreases between 0.1 and 0.25 percentage points across a variety of savings products.
Those holding Help to Buy ISAs face the steepest reductions, with rates dropping from 2.5 per cent to 2.25 per cent.
Child trust funds, Smart Junior ISAs, and their maturity equivalents will also see rates fall by 0.25 percentage points, moving from 3.05 per cent down to 2.8 per cent.
Nationwide announces savings shake-up affecting millions next month
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GETTY / NATIONWIDEThe Continue to Save product faces a similar cut, declining from 1.75 per cent to 1.5 per cent.
Branch Future Saver and Children’s Future Saver accounts will likewise drop from 3.05 per cent to 2.8 per cent.
Triple access accounts face varying reductions, with the one-year online version dropping from 3.5 per cent to 3.3 per cent, whilst branch and standard triple access products fall more sharply from 1.55 per cent to 1.3 per cent.
Single access savers and ISAs, including reward and branch variants, will decrease from 3.05 per cent to 2.8 per cent.
Limited access products, encompassing branch, online, and e-Savings Plus accounts, are being reduced from 1.5 per cent to 1.25 per cent.
Flex Instant Saver accounts across issues two through six will see rates decline from 2.5 per cent to 2.3 per cent.
Reward Saver and Reward ISA products drop from three per cent to 2.75 per cent.
Several Nationwide savings products will escape the rate reductions entirely. The Flex Regular Saver, FlexOne Saver, Start to Save range, Smart Instant Access, SmartSaver, and Smart Limited Access accounts remain unaffected.
In contrast to the widespread cuts, the building society is raising its five-year fixed-rate bond and ISA to 4 per cent for savers prepared to commit their funds for a longer period.
Tom Riley, Nationwide’s director of group retail products, said: “Although we’ve made reductions to a number of savings accounts, our range continues to pay more than the market average, giving savers every reason to put their money with Nationwide.”
Nationwide accounts affected by the rate change
Regular savings
- Help to Buy ISA: cut from 2.50 per cent to 2.25 per cent
- Continue to Save: cut from 1.75 per cent to 1.50 per cent
Children’s accounts
- Child Trust Fund, Smart Junior ISA, CTF Maturity ISA, Smart Junior ISA Maturity: cut from 3.05 per cent to 2.80 per cent
- Branch Future Saver, Future Saver, Children’s Future Saver: cut from 3.05 per cent to 2.80 per cent
Limited access accounts
- 1 Year Triple Access Online Saver and ISA: cut from 3.50 per cent to 3.30 per cent
- Branch Triple Access, Triple Access Saver and ISA: cut from 1.55 per cent to 1.30 per cent
- Reward Single Access ISA, Single Access ISA, Single Access Saver, Branch Single Access and Branch Single Access ISA: cut from 3.05 per cent to 2.80 per cent
- Branch Limited Access, Limited Access Saver, Limited Access Online Saver and e-Savings Plus: cut from 1.50 per cent to 1.25 per cent
Instant access accounts
- Flex Instant Saver (Issues 2 to 6): cut from 2.50 per cent to 2.30 per cent
- Branch Reward Saver, Branch Reward ISA, Reward Saver and Reward ISA: cut from 3.00 per cent to 2.75 per cent
- Branch Flex Saver, Branch Flex ISA, Flex Saver and Flex ISA: cut from between 1.25–1.45 per cent to 1.15–1.25 per cent
- Branch Easy Access and Instant Access: cut from between 1.10–1.35 per cent to 1.10–1.20 per cent
- Branch Instant Access Maturity and Instant Access Saver (Issues 10 and 15): cut from 1.45 per cent to 1.25 per cent