Nationwide is offering an eight percent interest rate on its regular savings account, positioning itself as the frontrunner in its sector.

Commenting on the product, Tom Riley, director of retail products at Nationwide Building Society, said: "We're rewarding our current account customers with a market-leading rate of eight percent AER on our Flex Regular Saver.

"We believe this is a further demonstration of the difference of being part of a modern, member-owned organisation."

The interest rate is fixed for a year and customers can save up to £200 per calendar month in the online managed account.

Savers can open the account with as little as £1, and they are allowed up to three withdrawals to retain the eight percent rate.

If savers exceed this limit by making four or more withdrawals, the interest rate will drop to 2.15 percent.

The Flex Regular Saver is only available to customers who hold one of the society's current accounts, which includes the FlexPlus, FlexDirect, FlexAccount, FlexStudent, FlexGraduate, FlexBasic or FlexOne. Savers must be aged 16 or over and only one Flex Regular Saver can be opened either as an individual or a joint account.

Writing in this week's Money Saving Expert (MSE) email, founder Martin Lewis said: "Finally, for the first time since early 2021, top easy-access savings pay more than inflation. Yet, most people still have LOSINGS, as they're earning diddy-squat, so money's shrinking.
"Five percent is the absolute minimum you should earn.

"Nationwide eight percent VARIABLE for a year on up to £200/mth. Maxed over a year at current rates you get £103 interest."

But while Nationwide may be offering the top rate for regular savers, competition isn't too far behind. Online-based bank first direct is offering an AER of seven percent fixed for 12 months and Britons can get started with just £25.

Interest is calculated daily and paid on maturity of the account exactly one year after opening. Savers can deposit between £25 and £300 per month in multiples of £5.

Withdrawals are not permitted throughout the duration of the 12-month term. In the event of this, the account will have to close and interest will be paid up to the closure date at the Savings Account variable rate instead.

Gatehouse Bank is also offering an Expected Profit Rate of seven percent. Gatehouse Bank operates under Sharia principles, which means profit is earned instead of interest, and this is paid on maturity.

People can save up to £300 per month and no access is permitted until the term ends after 12 months. The account can be opened and managed online by savers aged 18 or over.

Lloyds Bank's Club Lloyds Monthly Saver places next with an AER of 6.25 percent. A £25 deposit is required to open this account and the term runs for 12 months, which means up to £4,800 can be invested over the course of the year.

The account is available to Club Lloyds customers and unlimited withdrawals are permitted without penalty. The interest rate is fixed and will be paid on the anniversary of the account opening, and deposits between £25 and £400 must be invested before the 25th of every month.

Tipton & Coseley Building Society's Fixed Rate Regular Saver falls just behind with a competitive rate of 6.2 percent until October 31, 2024.

The account can be opened with a minimum deposit of £25 and up to £250 can be invested every month. Interest is calculated daily and applied annually on December 31 and maturity. Savers must be aged 16 or over and withdrawals are not permitted.