Britain’s biggest building society has launched an 8pc regular savings deal – the best rate on the market for a decade.
Nationwide’s Flex Regular Savings account, which is available from Thursday, will pay an interest rate of 8pc for 12 months.
Alongside First Direct’s regular saver, which pays 7pc in annual interest, it is one of only two savings accounts to beat inflation.
Inflation fell unexpectedly to 6.7pc last month, the Office for National Statistics announced on Wednesday.
However, the deal is only available to existing customers who hold one of Nationwide’s current accounts and savers can only save up to £200 per calendar month in the account.
Additionally, the account allows only up to three withdrawals within the 12 months after the account opening. If an account holder goes over this number, then the savings rate will drop to a 2.15pc variable. After 12 months the account will revert to an instant access account.
It comes a month after the financial regulator said it will “name and shame” lenders who do not pass on the Bank of England’s rate rises.
The Bank is expected to increase rates to 5.5pc on Thursday, with analysts at Citibank suggesting it will be the final increase in the tightening cycle.
The increases have pushed average savings deals to their highest levels since the financial crisis.
Santander launched an easy-access account paying 5.2pc on savings up to £250,000 on September 4 – the best easy-access savings deal for 14 years – but pulled the deal early a week later.
Tom Riley, of Nationwide, said: “We want to give people every reason to join and stay with Nationwide. We’re rewarding our current account customers with a market-leading rate on our Flex Regular Saver.
“We believe this is a further demonstration of the difference of being part of a modern, member-owned organisation.”
Savers who switch their current account to Nationwide will also get a £200 switching bonus from today, the mutual announced.
To qualify for the cash, savers must complete a full switch using the society’s “Current Account Switch Service”.
Nationwide said customers who switch to its new account could earn up to £377 during the first year by using both incentives.
The switching deals are available for applications started on or after September 21. To qualify for the incentives savers must save £200 on the first day of each calendar month into the account.