A safe haven but not always the best rates (Nationwide Building Society)

Member Name: Dunks

Product:	Nationwide Building Society
Date:	02/10/08 (324 review reads)
Rating:

Advantages: 'Safer' than stock market-exposed banks, great customer service, friendly, certain rates good

Disadvantages: Not as competitive as they could be, become slightly complacent.

The Nationwide is the largest building society in Britain and indeed the world. It is owned by its members in contrast to conventional banks which are plc's owned by shareholders. Many building societies demutualised and became plc's in the 80's, 90's and early 00's including Abbey National, Alliance & Leicester, Bradford & Bingley, the Halifax and Northern Rock but the Nationwide has stuck to its guns so far and remained a building society. Bearing in mind this not-so-sterling list of companies in these turbulent economic times, I can't see this changing any time soon!

So the Nationwide is seen as somewhat of a 'safe haven' at the moment but has this allowed them to get a bit complacent? I've noticed, looking at the money sections for the past few weeks, that their products rarely feature in the top 5 for competitve rates, whether that is credit cards, loans, mortgages, ISAs, savings and so on (though at the moment their flexible mortgage rate is best at 5.68%). I have my credit card with the Nationwide and it is a cash reward card with a reward rate of 0.5%. This has a higher interest rate than other cards but as I pay the balance off each month it is a win-win for me! I have an ISA with them but am considering transferring this to NatWest because the rate is much higher - best cash ISA at Nationwide is 6.15% compared with 6.5% at Natwest for the amount I'm wishing to invest. I also have an e-Bond which is paying a rate of 6.5%, well above Bank rate, but again this is a shade under the best rate which I believe is Bradford & Bingley at 6.7% (though again, this may not be entirely wise given the economic climate!) My current account is with them too but the less time your money is in this, the better!

One thing Nationwide really has going for it is the level of service and the friendliness of the staff. Queues are shorter and service is readily available at branches, phone and on their excellent online banking service. Staff are always very willing to help and have even cancelled interest and late charges when I have been late paying my card through no fault of my own, e.g. paying it way before the deadline but it not going through on time because of bank holidays, the slow system etc. This is very generous and I know not all banks would be so forgiving. I now pay online though to make absolutely sure and this goes through the next working day. If you pay through the branch it can take up to five working days to go through their 'system' so this is well worth doing. Their advisers at the branches are very knowledgeable and helpful, but then this isn't surprising as they're trying to get more of your money!

Nationwide don't punish you with worse rates for using a chequebook, which is good because I still like to keep a chequebook to pay membership fees and the like.

Some of Nationwide's rates are disappointing given their mutual status. Given they don't need to make a profit, they should be more competitive than the banks, more of the time. Their level of service, however, is second-to-none so I will be keeping much of my banking with them for some time to come.

Summary: Better than the 'big 4' but room for improvement!