The building society has confirmed the date the overhaul will commence following Bank of England decision
Nationwide is set to implement an unpopular decision that will result in interest rate cuts on a multitude of savings accounts starting next month. The building society has confirmed that the overhaul will commence from Tuesday, February 10, leading to many savers earning less on their deposits.
This move follows the Bank of England’s recent base rate reduction, which has had ripple effects throughout the savings market.
In response to the cut, Nationwide announced it will be reducing rates across a broad spectrum of products, with reductions ranging between 0.15% and 0.25%. In total, a staggering 37 separate Nationwide savings accounts and products will feel the impact of this change.
The cuts will affect regular savings accounts, children’s savings, limited access accounts, and instant access products.
Regular savers will witness falling rates on products such as the Help to Buy ISA and Continue to Save accounts. Parents are also set to bear the brunt, with several children’s products including Child Trust Funds, Junior ISAs, and Future Saver accounts being affected.
Limited access savers are among the hardest hit, with rate cuts applied to Triple Access, Single Access, and Limited Access savings and ISAs.
Instant access customers are not exempt either, with numerous Flex Instant Saver issues and Reward Saver accounts experiencing reduced rates. Some Flex Saver and Flex ISA products will also yield less interest across various balance levels.
Nationwide emphasised that most rate reductions are smaller than the full Bank of England cut. It also confirmed that some products will remain unaffected by these changes, including the Flex Regular Saver, FlexOne Saver and Start to Save accounts. In a minor uplift, Nationwide has announced an increase in the rate on its five-year Fixed Rate Bond and ISA to 4% for customers prepared to commit their funds for an extended period.
Savers are being encouraged to scrutinise their account details to determine if they hold any of the 36 products impacted by the recent reductions.
In December rateswere reduced to their lowest in nearly three years as the Bank of England cautioned that further cuts will be a “closer call”. The Bank’s Monetary Policy Committee (MPC) voted to reduce rates from 4% to 3.75%.
Governor Andrew Bailey said the UK has “passed the recent peak in inflation and it has continued to fall”, allowing the MPC to cut borrowing costs for the fourth time this year. “We still think rates are on a gradual path downward,” he added.
“But with every cut we make, how much further we go becomes a closer call.” Economists reportedly said the pace of interest rate cuts will slow next year as the Bank gets closer to what it deems a “neutral” rate and inflation nears its 2% target level.
The latest reduction took the bank’s base interest rate to its lowest level since early 2023.
Product Type
Account
Previous Headline Rate
New Headline Rate
Change
Regular Savings
Help to Buy ISA
2.50%
2.25%
-0.25%
Continue to Save
1.75%
1.50%
-0.25%
Children’s
Child Trust Fund / Smart Junior ISA/ CTF Maturity ISA / Smart Junior ISA Maturity
3.05%
2.80%
-0.25%
Branch Future Saver/ Future Saver / Children’s Future Saver
3.05%
2.80%
-0.25%
Limited Access
1 Year Triple Access Online Saver / ISA
3.50%
3.30%
-0.20%
Branch Triple Access/ Triple Access Saver / ISA
1.55%
1.30%
-0.25%
Reward Single Access ISA / Single Access ISA / Single Access Saver/ Branch Single Access/ Branch Single Access ISA
3.05%
2.80%
-0.25%
Branch Limited Access/ Limited Access Saver, Limited Access Online Saver, e-Savings Plus
1.50%
1.25%
-0.25%
Instant Access
Flex Instant Saver – Issues 2, 3, 4, 5, 6
2.50%
2.30%
-0.20%
Branch Reward Saver/ Branch Reward ISA/ Reward Saver / Reward ISA
3.00%
2.75%
-0.25%
Branch Flex Saver/ Branch Flex ISA/ Flex Saver / Flex ISA
1.25%-
1.45%
1.15%-
1.25%
-0.20%
Branch Easy Access/ Instant Access
1.10%-
1.35%
1.10%-
1.20%
-0.15%
Branch Instant Access Maturity/ Instant Access Saver – Issue 10 & 15
1.45%
1.25%
-0.20%
In addition to this, Nationwide will increase the rate on its five-year Fixed Rate Bond and ISA to 4%.
There will be no changes to:
- Flex Regular Saver
- FlexOne Saver
- Start to Save products
- Smart Instant Access & SmartSaver
- Smart Limited Access
