Savers must act now to take advantage of Nationwide's 5% AER FlexDirect current account before its rate gets slashed to 2% on Friday 1 May.
And it's not the only account that's set for a dramatic interest reduction; several other cuts are due this month, so you might want to rethink your plans if you want your cash to make a return.
The reductions are mainly due to the Bank of England's decision to cut the base rate to a historic low of 0.1% last month due to the coronavirus crisis. This makes it cheaper for banks to borrow and means they no longer need savers' cash to cover their loans.
Here, Which? explains how to apply for a FlexDirect account before it's too late, what the account offers and what other current account rates are set to fall in the coming weeks.
There's still time to get the higher rate of interest before Friday's rate cut - but you'll have to act fast.
Nationwide says that anyone who starts an application to open its FlexDirect account before 1 May 2020 will have the current 5% AER rate applied for the first 12 months.
After the first year, the rate will drop to 0.25% AER - which will only be paid on the first £1,500 in the account.
Firstly, to qualify for the interest, you must pay in at least £1,000 per month, so those with lower earnings might not be able to benefit.
The interest rate also only lasts for 12 months, at which time it drops dramatically. If you know you're someone who's unlikely to remember to switch - or who would rather stay put for longer - you might want to reconsider.
The account is also better suited to those who can maintain a balance of at least £2,500 to make the most of the interest payments.
It's worth bearing in mind that, while 5% AER is a much higher rate than that offered by any other account at the moment, the interest is only paid on the first £2,500 in the account.
If you maintain a balance of at least £2,500 over the course of a year - the maximum amount of time you'll get the 5% rate - you'll earn around £125 in interest.
Granted, it's more than you'd be able to earn in a year with the same amount of money in a traditional savings account, but it's not a life-changing sum.
After 1 May, however, 2% AER will be paid on £1,500 for the first year. This means you'll have earned just £30 in interest - almost £100 less.
Nationwide isn't the only big bank slashing its current account rates in May. The table below shows other changes to watch out for.
|Account||Current AER||Upcoming AER|
|Nationwide FlexDirect||5% (for first 12 months on balances up to £2,500)||2% (from 1 May; for first 12 months on balances up to £1,500)|
|TSB Classic Plus Account||3% (paid on balances up to £1,500)||1.5% (from 2 May; paid on balances up to £1,500)|
|Santander 123 Current Account||1.5% (paid on balances up to £20,000)||1% (from 5 May; paid on balances up to £20,000)|
|Starling Bank Current Account||0.5% (paid on balances up to £2,000; 0.25% on balances up to £85,000)||0.05% (from 18 May; paid on balances up to £85,000)|
TSB current account holders can currently earn around £44.40 a year on a balance of £1,500 but once the rate is reduced to 1.5% returns will fall to £22.35 a year - a £22.05 fall.
Any Santander customers with £20,000 stashed away can currently earn about £238 in a year (after the £5 monthly fee), but after the rate falls to 1% this will drop to £140 (after fees) - nearly £100 less.
Interest losses may also be felt by anyone with a lot of cash held in a Starling Bank current account. Taking the example of someone with £20,000 over a year, the current rates would see them earn £100. But once the rates are cut, this interest would reduce to just £10.
When it comes to current accounts, earning interest is not the only thing you'll need to consider before making a switch.
You'll also need to think about factors like:
If you're ready to switch, this could be done in just seven working days if the provider is part of the current account switch service (CASS).