Nationwide temporarily stops accepting ISA transfers

From today, Monday 7 July, Nationwide Building Society has temporarily closed its cash ISAs, including Fixed Rate ISA Bonds, to customers transferring their ISA from other providers.

The Society will continue to offer new ISAs for people who have not yet used this year's ISA allowance, using cash or a cheque but not a transfer. Existing Nationwide ISA holders will still be able to transfer between the Society's ISA products.

The Society has put a hold on ISA transfers-in because extremely high volumes threatened to impair the level of service which the Society is able to offer its customers.

Matthew Carter, savings director at Nationwide, says: "Our ISA products have all offered a consistently competitive rate of interest and, as a result, we have seen an unprecedented increase in the number of ISA transfers into the Society. During the first three months of this financial year alone, volumes have been almost 400% up on last year.

"The combination of our excellent interest rates and the fact that people are increasingly looking to invest their money in building societies during difficult market conditions, means we are not always able to deliver the level of service our members expect. Rather than risk disappointing our customers, we have decided to temporarily stop transfers into our cash ISAs from other providers. We will reinstate the transfer-in facility once we are confident that the service we can provide is back to the standards we and our customers expect.

"Existing customers who have already initiated the ISA transfer process to Nationwide can rest assured that their application is unaffected by this change. Confirmation of their new ISA will be sent to them as soon as possible.

"The ISA system is outdated and we would like to see improvements made to facilitate swifter transfers and improve the customer experience. We have written to the HMRC and intend to work with the Government, industry and regulators to bring about change and improve the situation for all those involved."

Nationwide's Instant Access ISA paying up to 5% AER and the one, two and three year Fixed Rate ISA Bonds will continue to be made available for any customer not making a transfer from another provider, at a market leading rate of 6.15% AER. Existing members of three years or more can also open a Members' ISA Bond paying up to 5.25%. Nationwide's Legal and General stocks and shares ISAs are unaffected by these changes and the Society will continue to accept transfers into these products.