Nationwide's 'Fairer Share' £100 payment for eligible members

Band7

TheBanker said:

Band7 said:

TheBanker said:

Credit card and loan customers are not members (unless they qualify as a member by holding a current account, savings account or mortgage as well). So they do not need to be included in a distribution of the society's profits.

As the profits have been generated by savers and mortgage holders

Of course Nationwide makes profits from credit card and loan customers, even if those are not considered members if they don‘t also hold another account with Nationwide.

Your argument falls seriously down when demanding share payments based on contribution to profits, and at the same time excluding people who have contributed to profits.

I'm not demanding anything. 

The members are the owners, the non-members do not own part of the society.

Normally profit would be distributed to owners based on how many shares they own. Clearly this wouldn't work for a mutual. Hence my suggestion that the profit should be distributed in a way that favours those members who generated it.

 You repeatedly argue that you contributed to the profits and are therefore entitled to a share of the profits if profits are divvied out. This to me is a demand (and probably a justified one).

Yet you are quite happy to see others who contributed to those profits, perhaps even more than you have, thrown under a bus because they are not members. 

All this in the context of fairness. 

TheBanker

But the customers who are not members know they are not members. Or they should do if they read the paperwork before signing. So they do not own a share of the Society, or a share of the excess profits that are being given away.

A bank distributes it's profits based on how many shares each member (shareholder) holds which reflects the capital they have contributed to the company. So using a mechanism that tries to measure how much profit each Nationwide member has contributed feels fair enough to me

Nebulous2

To comment on some things without quoting.

Profit was over £2 billion. The amount being distributed is £340 million, that is not what they made. 

Banks are walking a tightrope. They have generated higher profits on the back of rising interest rates, but they may have losses in areas such as bonds for the same reason. They are at risk of questions about their stability leading to social media generated runs, so to be prudent they need capital to fund any potential outflows. 

I don't see any of the rest of the banks offering some of their enhanced profits back to customers. 

Banks are also under media and political pressure to 'pass on' some of the interest rate rises. 

Nationwide now have their new fairer share bond.  4.75% for 2 years. Better than they've done on savings for some time. 

Money_Grabber13579

From my perspective, Nationwide are clearly looking to reward customers who use Nationwide as their sole banking provider (or use it for a significant proportion of those services). 

If you don’t have a current account with Nationwide, then you must have one elsewhere and so they don’t seem to consider that this is sufficient to demonstrate loyalty to Nationwide. Likewise, if you don’t have either a mortgage or any savings with Nationwide, then it is likely that you have one or both of these types of products with another provider and so aren’t considered sufficiently loyal.

Yes, there will be some people who fall through the gaps because they don’t actually have a mortgage or any savings (maybe some renters?). Likewise, there will be people who strike it lucky by inadvertently meeting the conditions even when they do have significant banking relationships elsewhere.

But to me, the key point is that Nationwide are looking to reward loyalty for those customers who stick with Nationwide for everything (or most things). Hence the condition that you must have a current account and a savings or mortgage account and it won’t be difficult to meet the specific conditions for each of these if you don’t also use any of their competitors for banking facilities.

Expotter

Whether this reward is "fair" to members or not is certainly a matter for discussion, but in my opinion this might actually backfire on Nationwide. 
Yes, they have made 3.4m of their customers very happy ( reported to be about a quarter of their membership) but that also means that the other 75% have been left feeling unvalued and treated as second class customers, myself included despite having a current account, savings account and credit card for years.
I can only speak for myself, but at the next available opportunity I'll be switching my account and taking my custom elsewhere. If Nationwide doesn't consider me a valued customer, why oh why should I value them? 

Section62

Money_Grabber13579 said:

From my perspective, Nationwide are clearly looking to reward customers who use Nationwide as their sole banking provider (or use it for a significant proportion of those services). 

There's nothing in anything Nationwide have said which supports your belief.

Nationwide have suggested they are rewarding members who have their "main" current account with Nationwide, but as ever the difficulty is in defining what "main" means.

I'm lucky that this particular iteration of what "main" means happens to coincide with what I used my FlexAccount for in the relevant months, but I don't consider my FlexAccount to be my "main" current account at the present time.  That one is with a different provider.

The we have a member of this forum who comes close to this concept of "sole banking provider", but because they spread their transactions over two Nationwide current accounts for budgeting purposes are unlucky that neither account qualifies as a "main" one.

This is why people are unhappy with the apparent lack of fairness in Nationwide's approach (as a mutual).

masonic

Money_Grabber13579 said:

From my perspective, Nationwide are clearly looking to reward customers who use Nationwide as their sole banking provider (or use it for a significant proportion of those services). 

If you don’t have a current account with Nationwide, then you must have one elsewhere and so they don’t seem to consider that this is sufficient to demonstrate loyalty to Nationwide. Likewise, if you don’t have either a mortgage or any savings with Nationwide, then it is likely that you have one or both of these types of products with another provider and so aren’t considered sufficiently loyal.

Yes, there will be some people who fall through the gaps because they don’t actually have a mortgage or any savings (maybe some renters?). Likewise, there will be people who strike it lucky by inadvertently meeting the conditions even when they do have significant banking relationships elsewhere.

But to me, the key point is that Nationwide are looking to reward loyalty for those customers who stick with Nationwide for everything (or most things). Hence the condition that you must have a current account and a savings or mortgage account and it won’t be difficult to meet the specific conditions for each of these if you don’t also use any of their competitors for banking facilities.

I for one would welcome them launching a current account that made me want to use it as my main account. In the past their offerings have been better.

zagfles

Expotter said:

Whether this reward is "fair" to members or not is certainly a matter for discussion, but in my opinion this might actually backfire on Nationwide. 
Yes, they have made 3.4m of their customers very happy ( reported to be about a quarter of their membership) but that also means that the other 75% have been left feeling unvalued and treated as second class customers, myself included despite having a current account, savings account and credit card for years.
I can only speak for myself, but at the next available opportunity I'll be switching my account and taking my custom elsewhere. If Nationwide doesn't consider me a valued customer, why oh why should I value them? 

They also seem to think that all "main" current account customers have a monthly income, and if you don't pay in regularly every calendar month you can't be a real customer. Plenty of self employed people, pensioners etc will have variable frequency income and perhaps only get "paid" every 3 months or so, so even if that amount was several thousand, just because they don't tick the "pay in at least £500 for 2 months" they're not real customers it seems. Even if they have savings with thousands or a mortgage of tens or even hundreds of thousand, which will be much more profitable for them than current accounts.

xylophone

I think some people are just annoyed because Nationwide are only valuing current account holders. Now we know where their priorities lie.

A PLC in all but name.....?

zagfles

Money_Grabber13579 said:

From my perspective, Nationwide are clearly looking to reward customers who use Nationwide as their sole banking provider (or use it for a significant proportion of those services). 

If you don’t have a current account with Nationwide, then you must have one elsewhere and so they don’t seem to consider that this is sufficient to demonstrate loyalty to Nationwide. Likewise, if you don’t have either a mortgage or any savings with Nationwide, then it is likely that you have one or both of these types of products with another provider and so aren’t considered sufficiently loyal.

Yes, there will be some people who fall through the gaps because they don’t actually have a mortgage or any savings (maybe some renters?). Likewise, there will be people who strike it lucky by inadvertently meeting the conditions even when they do have significant banking relationships elsewhere.

But to me, the key point is that Nationwide are looking to reward loyalty for those customers who stick with Nationwide for everything (or most things). Hence the condition that you must have a current account and a savings or mortgage account and it won’t be difficult to meet the specific conditions for each of these if you don’t also use any of their competitors for banking facilities.

They seem to use monthly pay ins as a marker. They seem to think everyone has a monthly income. What about a pensioner (pre state pension age) who lives on drawdown taken every 3 months? Self employed person who transfers from drawings from their business once every few months depending on profits? Student who gets a grant every term (I bet they recognised that one but only for the student account, I CBA checking, but not the others).