New laws will progress through Parliament later this year
Top Treasury officials have discussed major legal changes impacting Nationwide Building Society customers, as well as other building societies. MPs requested an update from senior Government officials on their efforts to expand the mutuals sector across the UK.
Gwyneth Nurse, director general of financial services at the Treasury, informed the Treasury Committee: “We are engaged in a multi-year programme across the mutuals sector. The Chancellor set out quite a lot of this in her first Mansion House speech, and we have been pursuing it ever since.” In her 2024 Mansion House speech, Chancellor Rachel Reeves unveiled a series of reforms to “unlock the full potential” of the mutuals and co-operative sector.
One major change she proposed was to reform the regulations governing building societies, such as Nationwide. Existing legislation was revised later in 2024 to facilitate the easing of funding limits imposed on building societies, by offering certain exemptions to these limits.
The aim was to broaden the ways these mutuals finance their daily operations, by providing them with greater flexibility to raise funds from sources other than their members’ savings. The amendment stipulated that the Treasury could introduce further regulation “made by statutory instrument” to define what type of funding would be exempt from the funding limits.
Ms Nurse had an update for the committee on this: “In the same speech [Mansion House 2024], the Chancellor announced that we would make progress on the statutory instruments we need to change the funding limit for building societies. We have not made progress on that yet, but I can tell you that we will be laying those statutory instruments before the summer recess.
“We have some resource that has come in to help us do that.” The summer recess for Parliament is scheduled for July 16.
The Government also previously stated its ambition to double the size of the mutual and co-operative sector. The committee queried whether Labour’s goal to double the sector would be achieved by expanding smaller providers or creating “lots more Nationwides”.
Nationwide boasts millions of members and over 600 branches. The group recently committed to keeping all its high street branches open until at least the beginning of 2030.
Ms Nurse informed the committee: “I think it would be hard to make lots more Nationwides. There is not a single answer to that. It depends on which part [of the financial services sector] you are looking at.”
Also in her 2024 Mansion House speech, the Chancellor requested the Financial Conduct Authority and the Prudential Regulation Authority to compile a report on the mutuals sector. Ms Nurse provided an update on this piece of work: “They delivered that in December and have committed to looking further at credit union regulation in particular.
“There are a number of recommendations in the report that we will be looking at, and we will be working collaboratively with them on that.” Last year, Nationwide also worked with other large mutuals to establish the Mutual and Co-operative Business Council.
The council aims to better coordinate the sector by working with related trade associations. Ms Nurse said: “I am really pleased to say that it [the council] has produced three reports on growth in various aspects of the sector. Again, there are some recommendations for us, which we will be looking at closely, working in collaboration with the people involved.”
£175 bonuses for Nationwide customers
Nationwide customers might also wish to check their eligibility for a £175 payment from the provider. You can currently receive the one-off sum if you transfer your current account from a non-Nationwide provider to a new or existing FlexDirect, FlexAccount or FlexPlus account.
You must complete a full switch using the Current Account Switch Service, which includes closing your previous account. Customers must also deposit at least £1,000 and make one debit card transaction.
Both these requirements need to be fulfilled within 31 days of either opening your new account or requesting the switch into an existing account. After you’ve completed all these steps, the £175 will be deposited into the account you switched to.
The sum will be credited to your account within 10 days of completing all the requirements. The payment will appear on your statement as ‘Switching Offer’. You will only receive one payment if you are switching to a joint account.
