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Nationwide to launch business banking current account

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Nationwide chief executive Joe GarnerNationwide chief executive Joe GarnerSwindon-based Nationwide is to launch a business banking current account aimed at small and micro businesses.

The plans by the world’s biggest building society will create a marketplace challenger to the UK's five Big Banks.

Nationwide is currently the only major financial services provider not to currently offer an SME banking proposition.

The mutual said it would be seeking £50 million from the RBS remedies fund to kickstart its business banking arm, but said it would plough on with its plans with or without external funding.

The announcement came as the building society revealed statutory profit before tax had fallen by 17 percent to £516 million.

But the society grew member deposits by £5.1 billion and 595,000 people opened the new Single Access and Loyalty ISA.

Nationwide chief executive Joe Garner said: “Supporting small businesses with a current account marks an important step for Nationwide – each year around 50,000 of our members ask us if we can help.

"This opportunity is just too big to ignore.

"As a mutual organisation driven by member needs and not profit, it will focus on the UK’s 5.6 million smaller and micro businesses - from tradespeople and sole traders to owner-managed businesses.

"And with more than 95 percent of UK businesses having fewer than ten employees, this will ensure Nationwide has wide appeal."

He said funding from the Capability and Innovation Fund would ensure Nationwide maximises its potential to enter the market with a strong and vibrant proposition.

A new team - Nationwide for Business - has been established to create and deliver the new account, in addition to applying for funding.

“Small businesses typically do not have complex banking needs, but they do demand and deserve excellent banking products and services as well as fair value," said Mr Garner.

"They need a current account that doesn’t take days to open or that levies large fees. They need someone they can contact and trust when they have a problem, and they need to know their banking provider has the scale and stability to be there when they need it."