The Flex Regular Saver pays 8% AER/gross interest for 12 months, the highest amount of any savings account on the market. It also smashes the current 6.7% rate of inflation.

As well as the market-leading rate offered on a maximum £200 per month deposit, unlike similar regular savings accounts, it allows customers to make three penalty-free withdrawals a year.

If a fourth withdrawal is made the rate drops to 2.15% AER variable.

However, to get the Flex Regular Saver, you need to hold a Nationwide current account, and to sweeten the deal, Nationwide is offering new customers £200 cashback to switch their everyday banking to the mutual.

By combining the two offers, customers opening its popular FlexDirect current account could earn up to £377 in the first year (£200 switching offer, 5% interest on balances up to £1,500 which generates £73 interest, and £104 in interest by putting away £200 in the regular saver on the first day of each month).

It comes as rivals TSB and Lloyds also launched new current account switching offers this week.

£200 cashback for switchers

For the £200 cashback, customers must complete a full current account switch, using the Current Account Switching Service (CASS).

You can choose between three different current accounts:

• FlexAccount which has no fees
• FlexDirect which has no fees but requires at least £1,000 to be paid in monthly. It pays 5% in-credit interest on up to £1,500
• FlexPlus which is a packaged account costing £13 a month with benefits such as insurance.

At least two direct debits need to be set up from the account before the £200 is paid into it, which Nationwide said should arrive within 10 calendar days of your switch completing.

The current account can be opened online or via the building society’s app. The switch must be completed within 60 days of it being requested to qualify for the cashback.

The offer is also open to existing customers, if they switch a current account they hold with another provider to an existing account they have with Nationwide.

While the £200 cashback offer is available for those three specific current accounts, the Flex Regular Saver is available to the following current account holders: FlexPlus, FlexDirect, FlexAccount, FlexStudent, FlexGraduate, FlexBasic or FlexOne.

How does Nationwide’s offer compare to others on the market?

Nationwide’s offer is impressive. Customers who complete the required steps will get £200 cashback and those who open the regular saver account will have access to 8% savings, on a maximum of £200 per month. It also has the extra flexibility of allowing up to three withdrawals in the first year. After 12-months the account will revert to an instant access account so diarise to check the rate then.

For switching deals, TSB technically pays a higher amount, of up to £210. However, this is split into a £150 cashback payment and then £60 in cashback during the first six months of opening the account, if certain requirements are met.

The next-highest amount available for switchers comes from First Direct. It pays out £175 to new switchers and they can access the bank’s regular saver, which pays 7% interest on up to £300 a month.

Lloyd’s Bank also has a new offer this week, it pays £175 and it throws in an extra benefit, such as 12 months of Disney+ or a magazine subscription. The account is £3 a month although this waived if at least £2,000 is deposited into it each month.

Based on savings rate, although Nationwide’s account is market-leading, if you have more money to put away you may be able to earn more interest elsewhere.

First Direct’s regular saver pays a lower amount of interest at 7%, but it allows savers to put away more money with a maximum amount of £300 allowed per month. This means over a year if the full amount was paid in the account at 7%, this would generate £136.50 in interest vs Nationwide’s £104 interest.

It’s only available to First Direct current account customers but there’s no limitation on how long you need to have a current account before you can open the linked regular saver.

Meanwhile, the Yorkshire BS regular saver also pays 7%, on a higher maximum of £500 a month, but it is only available to customers who have been with the building society for at least 12 months already. If the full £500 was deposited each month, interest of £227.40 would be paid after 12 months.

Related: How to get 7.5% interest without tying up your savings for years