Nationwide boost rates on fixed savings accounts and ISAs – are they a good home for your cash?

Nationwide has increased interest rates on its fixed term savings accounts and ISAs, with customers now able to get up to 4.7% on their cash savings.

The higher rates are available if you lock your money away to grow for a fixed amount of time, with no withdrawals allowed.

For the ISA products, any interest earned during the term will be tax-free.

Try 6 free issues of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

Richard Stocker, Nationwide’s head of savings, said: “We’re pleased to launch new higher rates on our fixed rate cash ISAs and bonds, while continuing to ensure customers can access the same rates whether they open their account online or in branch.

“With the UK’s largest branch network, backed by our Branch Promise, we’re committed to ensuring customers who prefer face-to-face service aren’t disadvantaged. Many of our branch-accessible products are among the highest-paying available from a major high street provider, reflecting our commitment to combining choice, value and support for savers.”

The improved interest rates make the accounts some of the most attractive among major high street savings providers, but they are not the highest available on the market.

What are the new rates?

Interest rates for Nationwide’s new fixed-term ISAs range from 4.4% to 4.7% depending on the amount of time you choose to lock your savings away for.

As the account is locked for a fixed-term you cannot access it whenever you like without paying a penalty.

If you make any withdrawals from the account, you will need to pay an early access charge equivalent to between 60 and 300 days’ interest depending on the term of your ISA. Your ISA will also be closed.

There is a 14-day grace period after opening the account where you can withdraw your cash without paying a penalty.

You must be a UK resident aged 18 or over to open one of these accounts. Any interest you earn from cash held in an ISA is entirely tax-free.

The table below shows the new fixed-rate ISAs and their interest rates:

Source: Nationwide, 14 August

The new interest rates for non-ISA accounts are slightly lower than the new rates for the ISA products.

These accounts can be opened by UK residents aged 16 and over and no withdrawals are allowed at all 14 days after opening the account.

A table showing a full list of the new rates can be found below:

Source: Nationwide, 14 August

Customers can access the exact same rates whether they open the accounts in-branch or online.

Are Nationwide’s new savings accounts any good?

Nationwide’s new, higher rates on fixed-term accounts are decent, but are still not the best on the market.

The top 4.7% rate on the five year fixed-rate ISA is just shy of the market-leading rate of 4.85% from Leek Building Society and Vida Savings.

This is the case for all of the new ISA accounts, which each offer a good interest rate, but none are the absolute best in the market.

As for the non-ISA savings accounts, there is a much bigger gap between Nationwide's rates and the market leaders.

The table below shows Nationwide’s new rates compared to the market leaders.

Source: Moneyfactscompare.co.uk, 14 August. Calculations based on £25,000 lump sum investment.

Nationwide customers may be happy to miss out on a slightly lower interest rate considering other perks offered by the building society – for example, the ability to visit bank branches.

Nationwide has promised not to close any more branches until at least the start of 2030, in contrast to the prevailing trend of branch closures.

Nationwide has also offered a £100 Fairer Share bonus to millions of eligible customers each year since 2023.

Rachel Springall, finance expert at Moneyfacts, said: “While they might not be market-leading rates overall, savers who would prefer to place their cash in a fixed account over the longer term, with a provider that offers an in-branch service, will find them competitively priced against other high street brands.

“Customers who flock to Nationwide can benefit from in-branch face-to-face support, which is ideal for those who may have accessibility issues, plus, its current account range is well worth considering due to the variety of cost-saving add-ons. When it comes to finding the best savings accounts, it’s always important to shop around and keep any nest egg as tax-efficient as possible, such as by using an ISA.”