Banks and building societies have recently begun to entice savers into online banking by boosting the interest rates offered by their online offerings in order to make them more attractive.
Nationwide Building Society has adjusted the interest rate on their one online offering, the MySave Online Plus account, to 2.39 per cent after tax. The online savings account is available for new and existing Nationwide customers alike.
While this new interest rate makes the Nationwide offering rise to the top of the best buy tables for internet-based savings accounts, the number of withdrawals savers can make from the account is restricted.
Launched this past October, the account had an after-tax rate of 1.2 per cent with the addition of a 0.6 per cent bonus for the first year of the account, making the total rate just under 2 per cent.
Now that previous 0.6 per cent bonus has been nearly doubled to 1.16, but savers are limited to just one withdrawal within the first 12 months or they face losing both interest and the newly boosted bonus rate.
Industry experts posit that the move is an attempt to compete with the new rates on the Post Office’s Online Saver, which now stand at 2.32 per cent after tax. The Post Office savings account, however, has no restrictions in regards to withdrawal limits.
Skipton Building Society has also raised the rate on one of its online banking offerings. Skipton’s My Savings online saver has been boosted to 2 per cent; additionally the building society has issued a guarantee that the rate will always be a minimum of 1.5 per cent higher than the BoE base rate, which currently stands at its historically low 0.5 per cent. Skipton will match the BoE rates until at least January of 2012.