Nationwide boost rates on fixed savings accounts and ISAs again – how do they compare?

Nationwide has boosted rates on some of its savings accounts, offering customers an interest rate of up to 4.55% on their cash.

The building society’s one and two-year fixed rate cash ISAs are now paying respective rates of 4.5% and 4.55% AER, up from 4.4% and 4.5% earlier this month.

Its one and two-year taxable fixed rate bonds now have interest rates of 4.5% and 4.55%, respectively, a rise from 4.25% and 4.3%.

It’s the second time this month Nationwide has bumped up rates on its fixed rate bonds and ISAs.

How do the savings accounts work?

Fixed rate cash ISAs

You can open one of the ISAs if you’re 18 or over, a UK resident and you haven’t maxed out your £20,000 annual ISA allowance this tax year.

People under 65 face a £12,000 per year limit on cash ISA contributions from April 2027. The overall £20,000 annual ISA allowance will remain.

If you are a new Nationwide customer, you have to apply for the ISA in a Nationwide branch. You can find your nearest branch using the building society’s search tool.

You have to fund the ISA during the application and can’t open it then top it up later. You can fund one of the accounts through an ISA transfer or via another Nationwide account.

You can withdraw money from one of the fixed-rate ISAs before the end of the term, but would have to pay an early access charge.

At the end of the term, the money from the account is moved to an instant access cash ISA with a lower interest rate.

Fixed rate bonds

Nationwide’s fixed rate bonds can be opened in branch or online if you’re 16 or over and a UK resident with an email address.

Once the fixed rate accounts are open, you can’t access your money until the end of the term. You can save up to £5 million in the accounts – although the Financial Services Compensation Scheme (FSCS) only protects up to £120,000 per person, per banking licence.

Money must be paid into the bond within 14 days of opening it. At the end of the term, your savings are moved to an instant access savings account paying a lower interest rate.

Are the boosted savings accounts worth it?

The headline interest rates on both the one and two-year fixed-rate cash ISAs can be beaten by other savings accounts on the market, based on the latest data from Moneyfactscompare as of 27 August.

AlRayan Bank’s one-year fixed-rate cash ISA pays 4.72% while Vida Savings has a two-year fixed-rate cash ISA paying 4.77%.

You’ll also find better headline rates on one and two-year fixed-rate bonds – AlRayan Bank’s one-year fixed-term bond is paying 4.87% interest while Investec Save’s two-year fixed-rate saver is paying 4.95%.

However, if you want to bank with an established name, Nationwide’s bumper rates on its one and two-year fixed-rate ISAs could be a good choice.

The two cash ISAs are paying higher rates for these types of accounts than the ‘Big Four’ banks – NatWest, Barclays, Lloyds and HSBC.

Nationwide’s one-year fixed-rate bond is much less competitive compared to other options on the market, but still offers the best rate out of the Big Four.

The two-year fixed-rate bond is also not as competitive and you can get a better rate with NatWest which is offering a two-year fixed term savings account paying 4.75%.

Rachel Springall, finance expert at Moneyfactscompare, said Nationwide customers can get in-person support at branches too, something a lot of digital banks don’t provide.

“Customers who find digital banking difficult, such as for accessibility reasons, will need to look beyond top rates to find a brand that can cater to their personal needs,” Springall said.

She added: “The fixed-rate cash ISAs from Nationwide are accessible for savers with either small or larger pots, with its minimum investment limit set at just £1, plus transfers in from both cash and stocks and shares ISAs are [currently] accepted. Those who do find they need their money sooner can even access the ISA funds early, subject to a set penalty.”