At a time when interest rates are fluctuating and financial institutions are adjusting their savings products, Nationwide Building Society is preparing to deliver a significant cash boost to thousands of its customers. Those who opened a specific high-interest savings account in March 2024 could see a bonus of up to £900 land in their accounts when their One Year Fixed Rate ISA matures in the coming months.
This announcement comes as a welcome surprise for many savers, particularly at a time when many financial products have seen interest rates drop following the Bank of England’s recent rate cut. While these lucky Nationwide customers will benefit from generous returns, the building society is also making important changes to its Fixed Rate ISAs, including stricter withdrawal rules and reduced interest rates for new savers.
For those who locked in their savings at the right time, this payout is a major financial win. But what exactly led to this unexpected windfall, and how do the upcoming changes affect future savers? Here’s a breakdown of everything you need to know.
Nationwide’s £900 Bonus: Who Qualifies?
Thousands of Nationwide customers who opened a One Year Fixed Rate ISA on 19 March 2024 are set to receive a substantial interest payout when their savings mature in the coming months. The One Year Fixed Rate ISA, which offered an Annual Equivalent Rate (AER) of 4.50%, allowed savers to deposit up to £20,000 tax-free, making it an attractive option at a time when interest rates were more favourable.
With the Bank of England recently cutting its base rate, newer savings accounts now offer lower returns, making this £900 payout even more valuable for those who locked in their savings at the right time.
For customers who deposited the maximum £20,000, the payout will be £900 in interest, equating to approximately £75 per month over the year. However, those who invested smaller amounts will still see a proportionate return:
- £1,000 deposited → £42 earned in interest
- £10,000 deposited → £450 earned in interest
For savers who opted for the Two Year Fixed Rate ISA, the wait will be a little longer. Their funds will remain locked until 2026, when they will receive their full interest payout.
Changes to Nationwide’s Fixed Rate ISAs – What You Need to Know
While some customers are set to receive significant payouts, Nationwide is making important changes to how its Fixed Rate ISAs work—changes that could affect future savers.
New Withdrawal Rules from 1 February
One of the most significant changes is that, starting 1 February 2025, customers who wish to withdraw money early from their Fixed Rate ISA will need to close the account entirely. This means they will no longer have the option to make partial withdrawals. On top of that, they will face an early access charge equivalent to 60 days’ interest, making it costly to access funds before maturity.
Lower Interest Rates for New Accounts
For customers looking to open a similar ISA today, the rates are not as high as they were in March 2024.
- The One Year Fixed Rate ISA now offers 4.10% AER, a drop from the original 4.50% AER.
- The Two Year Fixed Rate ISA is no longer available on Nationwide’s website.
Despite these changes, Nationwide insists it remains committed to offering competitive savings options. Tom Riley, Nationwide’s Director of Retail Products, reassured customers:
“We have worked hard to limit the impact of the recent rate cut on our savers and have taken the decision to hold rates on some of our most popular accounts, such as our leading Flex Regular Saver.”
He also highlighted that Nationwide returned a record £950 million in member financial benefits in the first half of the year, promising to continue offering strong incentives for savers.
What This Means for Nationwide Customers
For those who secured their savings at the higher 4.50% rate, the upcoming £900 payout is a welcome boost, particularly as interest rates for new accounts have since declined. However, the new withdrawal restrictions and lower savings rates mean that future customers may not enjoy the same benefits.
If You Have a One Year Fixed Rate ISA That’s About to Mature:
- You’ll soon receive your interest payment—potentially £900 if you deposited the full £20,000.
- You’ll need to decide whether to reinvest, withdraw, or move your savings elsewhere.
- If you want to continue saving with Nationwide, check the latest interest rates, as they have been reduced.
If You’re Considering Opening a New ISA:
- Be aware that interest rates are lower than last year, meaning potential returns will be smaller.
- Understand that withdrawal rules have changed, and accessing funds early will now require closing the account entirely.
- Compare savings rates with other providers to ensure you’re getting the best possible return on your money.
