Nationwide, the UK’s largest building society, announced that over 12 million of its customers will be receiving a payment of £50 each as a gesture of appreciation following the takeover of Virgin Money. This initiative will cost Nationwide a total of £600 million. However, there has been backlash regarding the lack of member participation in the £2.8 billion acquisition of Virgin Money last year, as it was done without a vote from Nationwide members.
Most customers can expect to see the £50 deposited directly into their accounts by the end of April, although some may receive the payment via cheque. Nationwide is currently in the process of informing eligible members about the payment and the expected timeline for when it will be received. Criteria for eligibility include having a savings or current account, or a mortgage, as of the end of September, as well as having made at least one transaction on their account within the last year, or maintaining a balance of at least £100 during that time.
It is estimated that around four million customers will not meet the criteria to receive the payment, and customers of Virgin Money will similarly not be eligible for the payment. Nationwide’s chief executive, Debbie Crosbie, emphasized that the payment is a recognition of the vital role that members played in establishing the financial stability necessary for the Virgin Money acquisition to take place. This move has solidified Nationwide’s position as the UK’s second largest provider of mortgages and savings accounts since the deal last year.
Amidst the acquisition and payment distribution, there has been controversy surrounding the lack of member approval for Nationwide’s decision to acquire Virgin Money. Unlike Virgin Money members, Nationwide members were not given the opportunity to vote on the deal, as Nationwide’s board felt it was unnecessary to seek member approval. Additionally, it is important to note that the £50 payment is separate from Nationwide’s fairer share payments scheme, which periodically distributes profits back to its members
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