Nationwide has launched a 30-month fixed rate bond paying 5.3% interest, a rate the building society describes as "inflation-busting." The product, announced on Tuesday, November 3, would return £1,381.92 in interest on a full £10,000 deposit held for the entire term.
The Member Exclusive Bond is only available to existing members of the building society or Virgin Money customers who have also joined the mutual.
Loyalty Rewarded
Richard Stocker, head of savings at Nationwide, said: "Our research shows people want loyalty to be recognised, and too many feel the best deals today are reserved for new customers. We don’t think being a loyal customer should mean watching the best deals go to someone else."
Rachel Springall, finance expert at Moneyfactscompare.co.uk, welcomed the new bond. She said: "It’s fantastic to see Nationwide rewarding the loyalty of its customers alongside Virgin Money customers, with the launch of this attractive 30-month fixed rate bond."
She added: "It is an inflation-busting guaranteed return, which could net customers over £1,380 on a £10,000 lump sum investment. Compared to other longer-term fixed bonds beyond 30 months, the deal pays more than both the top three-year fixed bonds, as well as some five-year bonds, so it will likely be an attractive choice for existing customers."
Branch Commitment
Ms Springall said that at a time when big banks continue to close branches, mutuals such as Nationwide continue to give customers more face-to-face support. Nationwide has pledged to keep its branches open until at least early 2030. The lender has also offered members a £100 Fairer Share payment and is currently offering a £175 current account switching incentive.
Anna Bowes, personal finance expert at The Private Office, said of the new bond: "It’s good to see a provider rewarding loyalty rather than paying the best rates to new customers only. We know that not enough savers regularly switch providers so having the chance to earn a market-leading rate as a loyal customer is refreshing, especially from a high street brand."
Terms and Conditions
The Member Exclusive Bond can be opened in branch, online or via Nationwide's app. Money must be deposited within 14 days of opening an account, with one bond allowed per saver. Nationwide warns the offer can be withdrawn at any time.
Eugen Neagu, Director at N2 Asset Management Limited, said the new bond is more of a market gimmick and a way to attract new customers. He added: "There are other banks with good credit ratings in need of new customers at this moment, for example Morgan Stanley which wants to enter the retail space with an online offering. You could get a three-year fix at 5.2%, with a lot higher cap of £120,000 and minimum £1,000."
CPI inflation was 3.5% for the 12 months to September, up from 3.1% in August, according to the Office for National Statistics. The Bank of England expects inflation to reach 3.7% in the fourth quarter and to about 4.2% in the first three months of 2027, driven by high energy costs.
