Nationwide Building Society has moved to clarify what happens to savings when a fixed-rate bond reaches the end of its term. The update follows an enquiry from a customer who asked whether a matured account could continue to be used like a normal savings account.
The customer asked on social media whether, once a fixed-rate bond had matured and was moved into an instant access maturity bond account, they could add money to it and treat it like a standard savings account. Nationwide responded: "Yes, that is correct. If your money is in an instant access account, you can add and withdraw money as you like."
Nationwide offers a Fixed Rate Online Bond with a fixed interest rate of 4 per cent across one, two, three and five-year terms. At the end of the term, the money is transferred into an instant access savings account. The society says it will let customers know before this happens and what their new interest rate will be.
However, savers should be aware of a potential drop in returns. At the time of writing, Nationwide's Instant Access Saver pays just 1.1 per cent on deposits up to £10,000, a fall of 3.9 percentage points from the bond rate. For deposits above £10,000, the rate rises to a maximum of 1.2 per cent, still well short of many leading savings accounts. Current account holders can instead choose the Flex Instant Saver, which pays 2.3 per cent variable over a one-year term.
Separately, millions of Nationwide members are set to receive a £100 payment as part of the society's latest Fairer Share bonus. More than four million customers will benefit, with the payment reflecting Nationwide's distribution of profits among its members. Full eligibility details are available on its website.
