Using the Building Society’s reserves to provide an ad-hoc dividend to random members.
It’s not very prudent ( banking crisis in the US & cost of living crisis / possible recession in GB)
I would also question if the management have also acted fast and loose with their fiduciary duty.
I think the fact that the requirements are obtuse will piss off a few customers.
A friend of mine has a current account and small savings but will be eligible, a family member life savings but no current account so isn’t.
Isn’t this kind of thing the reason people have building society accounts? That and a bank takeover.
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Agree, it’s a very arbitrary payout. I currently have nothing but a few almost empty accounts so I’m content with getting 0, but it looks like even if I used them as a main account and saved a fair bit I’d still be ineligible as my DDs were paid elsewhere.
Rather puts me off using Nationwide more because I don’t know what the rules might be in future.
I have no DDs with Nationwide, but I qualify.
It’s not a requirement.
What I should add though, is if it had not been for the supermarket promotion, I wouldn’t have had a second payment out of the account in February. Phew!
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Some context: Nationwide to pay £340m of profits directly into customers’ accounts | Nationwide | The Guardian
I’m not sure the criticism is warranted, TBH. A regular bank would just give the extra profits to its board of directors or a percentage to shareholders (as SVB did just days before going bust), but instead it is giving £100 to anyone who uses Nationwide as their main current account and has one other account (such as a savings account). There are far more egregious happenings in the financial space than a small kickback to the people who use its services.
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I agree. Nationwide rarely put a foot wrong and though they’re never going to set the world alight, they’ve always promoted the “look after your customers” ethic.
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I think they could have probably done it based on tenure instead of membership and arbitrary criteria. They’ve made a lot more than £340m too, so they could have probably made it available to all members.
Basically, I’m annoyed that as a member for 20 years I got sidelined.
Even Lloyds pays me around that and I only own several thousand of its 50gbx shares; a very very small fraction of the company
To be clear I’m not criticising the fact they have chosen to redistribute profit, I’m critical of the “£100 or 0” for jumping through arbitrary goals way that they’ve done it.
For example, lifting a contribution from MSE:
30+ years customer.
Savings criteria met.
Current account income met.
Current account withdrawals met.Don’t qualify because I have two current accounts for budgeting reasons. First one fails criteria as it doesn’t have external bill payments coming out of it. Bills current account fails criteria as it’s funded by the first current account.
As I said in my post, I’m quite content with receiving nothing as I’ve done nothing with them in the last year (other than switch away), but would feel less cool about it if I’d used it if I’d saved with them significantly.
I think a key difference between comparing what a bank would do vs. Nationwide is you are a customer of a bank. You’re a member (owner) of Nationwide.
What this scheme has done is take assets owned by members as a whole, and given them to just some of the members based on arbitrary/previously unpublished criteria.
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Yeah actually, I feel like they should have distributed it to all or none. Switching bonuses are very much not the same as arbitrary unpublished criteria, since one generates money for the society vs the other just being a distribution of assets
I wonder if there’s any route to contesting this?
On what grounds?
How have you wangled that switch bonuses make Nationwide money?
Distribution of shareholder funds to a subset, when we all have an equal right to any dividend issued. This is essentially a disguised dividend.
CAC is below CLTV
There is no entitlement. It’s a Building Society, not a Consumer Co-operative.
I should imagine there’s a reasonable case being made internally that this payment will improve CLTV by incentivising further loyalty.
I didn’t qualify but the criteria seem fair to me
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‘Some of the members’ meaning people who have an active current account and a savings account, therefore making most use of the services they offer.
Having a virtually dormant account because you once made use of a switch bonus once is not really of benefit to the building society. Using it is your main account, having direct debits etc is. They clearly had a few million they needed to do something with and had to draw the line somewhere.
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What about people with thousands in savings but no current account?
Can’t help but think it has current account switch style intentions to stimulate account usage/spending rather than rewarding those who’ve chipped in the most?
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Exactly. And lets face it, it’s all the deposits at Nationwide, often earning half the base rate, which have caused this sudden surplus.
I’d have a sour taste if I was one of them, to be honest.
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There is no requirement to have a direct debit to qualify. I alsoagree that Nationwide had to draw the line somewhere.
However, using that sum to improve interest rates may have been a better use of the funds. Other building societies such as YBS have adopted this approach.
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It’s been raving on multiple MSE forum threads for ages. Still hot topic this morning.
This is just one of them, and not the most posted on yet either.
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