From 2 August 2010, Nationwide will be writing to customers, to offer them free travel insurance worth almost £80¹ for joint cover, if they use its award winning FlexAccount as their main current account².

Nationwide's FlexAccount now offers its customers an exclusive and unique package of benefits with no monthly fee, including:

• Free European multi-trip travel insurance worth up to £80 per annum
• Access to the lowest personal loan rate in the market at 7.7% APR typical³
• Access to exclusive mortgage products including Protector Mortgage which offers Mortgage Payment Protection Insurance at no extra charge, free standard legal and valuation fees, borrowing of up to 90% loan to value and the Flexible Mortgage
• Among the lowest charges in the market for foreign currency transactions

The changes are designed to reward and provide outstanding value to customers who use Nationwide's FlexAccount as their main current account for their everyday banking. The Society is re-distributing value in a fairer way to ensure that those who have the strongest relationships with the Society, receive the most value.

From 1 November 2010, the Society will be making some additional changes to its current account including the introduction of a low charge for transactions in currencies other than sterling. This replaces the 1% third party foreign currency charge for point of sale transactions made outside of the Visa European region. Nationwide's FlexAccount remains the cheapest mass market current account to use abroad. The Society's new commission charge of 2% and £1 cash withdrawal fee are lower than any of those charged by other standard or free current accounts in the market. Unlike several other card providers, Nationwide does not also charge a fee when a customer makes a purchase abroad (see table on industry charges below). Up until 1 November 2010, many customers will benefit from both free travel insurance and commission-free card use abroad.

Nationwide's credit card continues to offer free use abroad within the VISA European region and a 1% charge worldwide.

When spending £1,000 abroad*, Nationwide customers will be charged at least £15 less than those using a card from seven other providers (see table below).

Table illustrating the cost of spending £1,000 using debit cards abroad

*By making four separate £50 card purchases and eight separate £100 cash withdrawals.
Source: card providers' websites correct as of 12 July 2010.

Nationwide has also reviewed a number of other charges on its account in order to give customers more control and make them easier to understand. These include:

• The reduction of the unpaid item charge by £15 to £15
• The removal of the £21.50 cheque guarantee misuse charge
• The ability to review and switch off the reserve limit4
• A maximum monthly overdraft charges cap of £95
• A paid item charge of £15

Chris Rhodes, executive director of marketing at Nationwide said: "Our new package of benefits offers greater value to more of our current account customers than before. The average customer saving with free card use abroad was about £12 a year. We're now able to offer those who use us for their day to day banking a benefit of much greater value and one that no other bank account offers - free travel insurance worth up to £80.

"Our current account now works in a way which ensures that those members who have the deepest relationship with Nationwide receive the most benefit. Previously, only a third of our current account customers used their card abroad, and many used it only for that, holding their main current account with another provider, bringing little or no benefit to the Society and its other members.

"Now, customers who use Nationwide's FlexAccount as their main current account can also access other great offers such as MPPI at no extra charge and 90% loan to value deals on some mortgage products, the UK's lowest personal loan rate of 7.7% APR typical and access to our best savings rates. What's more, we continue to provide the cheapest mass market debit card for use abroad."

Notes to editors

1. Based on a joint account where both named account holders are covered.
2. If you are an existing FlexAccount customer you must have a Nationwide Visa debit card (excluding cash card+) and have deposited £750 or more per month into your FlexAccount (excluding internal transfers from other Nationwide accounts) for the last 3 months.
3. Personal loan rate of 7.7% APR typical for loans of £7,500 to £14,999 for up to five years.
4. An amount beyond the agreed overdraft limit where we will continue to pay transactions. Customers can opt out of this so no items beyond agreed overdraft limit are paid.

Table showing industry charges for card use abroad

Correct as of 12 July 2010

Free Travel Insurance
The new free travel insurance will be available to both single and joint FlexAccount customers and will provide comprehensive European travel insurance for those who use the FlexAccount as their main current account and are under the age of 75 (new customers are eligible up to age 65). Eligible customers will be written to and will be covered immediately upon receipt of their letter. Those not qualifying will be covered from the 1st of the following month if they switch their current account to Nationwide using the Account Transfer Service. Cover for those aged over 65 and up to age 79 and additional family members is available at discounted rates. It is underwritten by UK Insurance Ltd.

Summary of cover

• Nationwide acts as an intermediary for Nationwide FlexAccount Travel Cover, which is underwritten by UK Insurance Limited on behalf of Nationwide Building Society.
• UK Insurance Limited's FSA registration number is 202810.
• Nationwide Building Society is authorised and regulated by the Financial Services Authority under registration number 106078. Credit facilities other than regulated mortgages are not regulated by the Financial Services Authority. You can confirm our registration on the FSA's website, www.fsa.gov.uk or by contacting the FSA on 0845 606 1234.
• Protector Mortgage with MPPI at no extra charge: this mortgage product includes mortgage payment protection insurance. This will provide Accident, Sickness and Unemployment cover during the 2 year mortgage product benefit period subject to the borrower remaining eligible for the plan. In the event of a claim it will cover the borrower's monthly mortgage payment as shown on their original mortgage offer relating to this mortgage product, for a maximum period of 12 months. The MPPI will end when the borrower's 2 year fixed rate mortgage product ends or when they no longer meet the eligibility criteria. If the borrower is in the middle of a claim, their claim will end when the maximum monthly benefit period is paid or they redeem their mortgage. All claims will be subject to eligibility criteria. MPPI is provided on behalf of Nationwide by Aviva Insurance Limited.
• Free Valuation Fees: Nationwide will pay the basic fee for the Mortgage Valuation Report required to determine the amount of advance it is prudent to make on the proposed security. The valuation does not include any payment for a more detailed Homebuyer's Report or additional specialist report.
• Free Legals for House Purchase: covers the conveyancer's professional charges relating to the house purchase only when using Legal Marketing Services (LMS). The customer will be liable for some additional fees relating to the disbursements, e.g. land registry fees and local authority searches. Due to Northern Irish law, we are unable to offer free legal fees in Northern Ireland.