Major building society to axe key service affecting 120,000 customers – are you one of them?
THOUSANDS of elderly customers at a major building society risk being left behind after it confirmed it is axing a key service.
In an email to customers, Nationwide said that its Loyalty Saver account holders will no longer be able to use a passbook to manage their savings account.
These savings accounts are reserved for customers who have used the bank for many years and often reward them with top interest rates.
Nationwide announced that it was axing passbooks in July but it had not yet confirmed the exact date it would do so until now.
Passbooks provide a vital lifeline to thousands of older customers who are unable to bank online or by mobile app.
The books are issued by a bank or building society and allow the account holder to keep a physical record of how much money they have paid in and taken out of their account.
They can also be useful if you want to limit impulse spending as there are a lot more steps to take with each transaction.
In spite of this, Nationwide has confirmed that they will be axed from February 6, 2025.
But as more banks move towards digital banking they have decided to stop offering passbooks.
Barclays and Santander both decided to scrap passbook savings accounts, which are no longer available to new customers.
Meanwhile, Nationwide has already stopped offering new passbook accounts to customers.
The building society said only 2% of its 16 million customers still use passbooks, which is equivalent to around 120,000 people.
Dennis Reed, a campaigner at Silver Voices, said: “Here is another example of a finance company telling older customers to get lost, we can’t be bothered with you.
“The local building society branch with a trusty passbook provides a good, friendly and safe banking service.
“We have no objection to digital banking, which has its advantages, but there should always be a face to face non-digital alternative available.”
What did Nationwide tell customers?
Nationwide said: “After February 6, 2025, if you had a passbook you won’t be able to use it anymore.
Why are banks making changes to fees and services?
The Sun’s consumer editor Lynsey Barber explains what’s going on.
Banks can make changes to the services and fees they offer at any time, and will usually tell customers directly when it affects them.
This could be the fee for a bank account, or the types of perks or services it offers, or even ditching a product altogether.
But there has recently been a flurry of changes at several banks and building societies, and that’s likely down to something known as the Consumer Duty.
The new rules came in last year and mean that financial institutions are obliged to follow certain rules that better protect customers.
Insiders say that the recent flurry of changes likely follow a review of what they offer consumers in light of this new duty.
These rules are fairly loose, and there’s no suggestion that any changes have been made because they are doing anything wrong. But there’s always room for improvement.The main aim is to act in good faith towards customers, avoid foreseeable harm and support customers to pursue their financial objectives.
In practice this means things like making sure that communications with customers, and terms and conditions, are clear and jargon-free. And that what a customer pays for a product or service is “reasonable” when compared to the benefits the product or service offers.
Another reason for changes may be that the business itself is going in a different direction. For example several supermarkets have sold off their banking arms to concentrate on their core business of selling groceries.
A long period of historically low interest rates has been good for business, but the financial landscape has changed as interest rates have gone up.
This means some products and services may no longer be cost effective or viable to offer from a business point of view.
There may sometimes be specific reasons given for a change. For example Nationwide has hiked fees on its FlexPlus account from £13 a month to £18, blaming rising insurance costs (the account offers policy perks).
What changes have come in recently?
Barclays has changed the way it calculates minimum credit card repayments and the APR on offer for some customers. It will no longer offer cashback via It’s Rewards account.
Metro Bank will no longer offer credit cards and has introduced a fee on all debit card transactions abroad.
Lloyds Banking Group, which runs Lloyds Bank, Halifax and Bank of Scotland shook up it’s overdraft fees, and axed fees for withdrawing money from cash machines abroad on its silver and platinum accounts.
“But you can still manage your account in a branch, if that’s what you like to do.”
It also told customers that their account details and the way they use their account will change.
For example, customers may be given a new sort code and account number.
It confirmed that the changes will not affect the customer’s interest rate.
Automatic payments, such as direct debits, which enter their savings account each month will not be impacted.
Can I still bank in branch?
Customers will still be able to manage their account at one of the bank’s branches.
Nationwide has pledged to keep branches open in every town and city where it currently has one until 2028.
Paper bank account statements can also be provided in store.
The bank has also launched a new savings wallet, which comes with its branch savings account.
Nationwide said: “If you like using your passbook and would prefer something similar to keep track of your savings, we may have another branch savings account that could be right for you.
“It comes with a savings wallet that has a pocket for mini statements and a card.”
For more information about the account visit your local branch.
You need to be a permanent UK resident to open one of these accounts.
Customers can also manage their account through internet banking or via the Nationwide banking app.
It is understood that the company will be taking on temporary staff to help with the transition from the old passbooks to the new savings wallets.
The news comes after Nationwide announced that it was axing passbooks in July.
At the time Nationwide said that it wants to “modernise” passbooks next year, with the process expected to take seven months.
Elderly customers who have their pensions paid into their passbooks are likely to be affected as they typically rely on paper records to manage their money.
The building society said once the change comes into force, staff in branch will be available to support vulnerable customers over the seven months.
Nationwide’s announcement is the latest in a series of blows to older and vulnerable customers.
In July we revealed that millions of vulnerable customers are being forgotten as firms move online.
Access to cash is one of the main issues.
In the past six years more than 15,000 cash machines have disappeared, according to the Association of Convenience Stores.
Meanwhile, many companies refuse to allow customers to pay for items with coins and notes.
A Nationwide spokesperson said: “We are modernising passbooks rather than removing them, but while they are changing, banking in branch isn’t.
“We are maintaining the benefits our passbook customers value most – face-to-face service and having a physical record of transactions.
“As the UK’s largest building society, we are investing in our systems so we can offer the products and services our customers expect from a modern mutual.”
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