Nationwide throws its hat in the ring on High Street

Nationwide, the UK’s largest building society, recently announced its intentions to expand its offerings to customers in the realms of free travel insurance and cheaper overdrafts.

Nationwide’s move for more market share followed on the heels of Santander’s announcement that it would be hiring 600 new staff to address customer service concerns that have been plaguing the bank after its acquisition of several UK branches, including Alliance & Leicester, Abbey, and Bradford & Bingley.  Santander is also offering cash incentives to entice consumers to open business bank accounts.

Industry insiders say that Santander is undoubtedly feeling the pressure to boost its public perception, especially in light of its pending purchase of several hundred RBS branches later this week.

NatWest also recently increased its public relations campaign in an effort to not only entice new customers but to also retain its existing ones by releasing a charter that positively bristles with customer-centric items such as lengthening their opening hours and pledging to reduce time spent in queue.

Industry experts believe that several High Street banks are attempting to upgrade their services to combat loss of market share.  This is especially important to incumbent banks due to the influx of new entrants to High Street such as Tesco,  Metro Bank, and Virgin, the latter which said last week that it had plans to establish a network of bank branches by 2011.

Less than one out of every 12 account holders ever switch their accounts from one bank to another, studies say.  This reticence to switch is even in the face of unhappiness with the level of service, high overdraft charges, or insufficient interest rates at their current bank.

After the global economic crisis and the failure of several banks, requiring massive taxpayer bail-outs, resulting in the nationalisation of several high-profile banks, the coalition government has been quick with its encouragement to foster a higher level of competition amongst the larger High Street lending institutions, which have historically enjoyed a tight grip over consumers for decades.

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