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Press release
NATIONAL SAVINGS AND INVESTMENTS TO ENTER GROWING EASY ACCESS SAVINGS MARKET
24 January 2004
Easy Access Savings Account to meet needs of savers and government
National Savings and Investments (NS&I), the Treasury-backed savings and investments provider, is to launch a new instant access savings account, the Easy Access Savings Account, on 29 January 2004. The new account is its first ever foray into the growing easy access savings market and combines a flexible, secure, straightforward and convenient way to save with competitive rates of interest.
The Easy Access Savings Account is being launched in place of the 143-year-old Ordinary Account and will offer easier access 24 hours a day and interest rates which are in the upper quartile for this type of account - between three and eight times higher than the Ordinary Account - and higher than many rates offered on branch-based passbook accounts.
An account card will be issued in place of the Ordinary Account passbook. It will no longer be possible to open a new Ordinary Account after 28 January 2004 and the Ordinary Account will close completely on 31 July 2004.
The easy access savings market
The easy access savings market is expanding. Between 2002 and 2003, it grew by 11% and is now worth approximately £200 billion. The Easy Access Savings Account is being launched to meet customers' changing needs and, by entering the easy access savings market, NS&I will continue to fulfil its role of providing cost-effective financing for government.
Easy Access Savings Account
The Easy Access Savings Account continues NS&I's drive to be the first port of call for people with money to save and invest and to meet its role of raising cost-effective financing for the government. It is aimed at savers who have no savings accounts with NS&I, and existing Ordinary Account customers are being invited to transfer to the new account. Currently, a total of 30 million customers hold £66 billion in NS&I's accounts, bonds and certificates.
The new account is simple to use, with access available over the telephone (0845 366 6667), via 47,000 LINK ATMs (Automated Teller Machines), by post and over the counter at Post Office® branches. It can also be opened online at NS&I's website (www.nsandi.com). The minimum balance of £100 is designed to encourage people to save and, backed by HM Treasury, the new savings account will afford the 100% peace of mind that savers expect from NS&I.
The new account will be operated from NS&I's Glasgow site where the Ordinary Account is operated.
Development of National Savings and Investments
Since 1999, NS&I has been undergoing a major period of modernisation and the Easy Access Savings Account is an important strand of this development. This modernisation has included:
| 1999 | The formation of a ground-breaking partnership with Siemens Business Services that has delivered better customer service, new products and sales channels as well as investment in IT |
| 1999 | Plans set in place to launch new products in the next five years (leads to issue of Guaranteed Equity Bonds and launch of Easy Access Savings Account) |
| 2001 | The introduction of telephone sales |
| 2002 | The launch of a 24-hour, seven days a week customer enquiries and telephone sales service |
| 2002 | A change in brand name from National Savings to National Savings and Investments |
| 2002 | The introduction of internet sales |
| 2002 | First Guaranteed Equity Bond issued |
| 2002/03 | NS&I contributed net financing to the government for the first time since 1998/99 |
| 2003 | NS&I signed up to the Banking Code |
| 2004 | Easy Access Savings Account launched, Ordinary Account closed |
Ordinary Account
The new account replaces the old fashioned 143-year-old Ordinary Account which offers limited access and modest returns for customers, as well as being expensive to operate for the taxpayer. The new savings account will be more efficient to run and will enable NS&I to pass on the benefit to customers in the form of higher interest rates and easier access. Only 2.7 million of the 13 million Ordinary Accounts in existence have been used in the past two years and 10 million of these accounts have less than £10 invested.
Meeting the needs of the saving public
Alan Cook, chief executive of National Savings and Investments, said: "NS&I's entry into the easy access marketplace is a key component of our continuing drive to offer a full range of products and channels that meet the diverse saving and investment needs of the British public, and contribute to government financing.
"This particular marketplace is expanding rapidly because of consumer demand and it is vital that we are part of that market if we are to continue to be seen as competitive and relevant by customers and the financial services industry at large.
"Our recent renaissance shows that British savers and investors continue to value the security, straightforwardness and simplicity of the National Savings and Investments offer, and the new account makes that offer even stronger."
ENDS
Notes to editors
- Easy Access Savings Account interest rates
| Account balance | Easy Access Savings Account* | Ordinary Account* ** *** |
| £100 - £499 | 1.00% | 0.25% |
| £500 - £999 | 1.00% | 0.35% |
| £1,000 - £4,999 | 2.50% | 0.35% |
| £5,000 - £9,999 | 2.80% | 0.35% |
| £10,000 - £24,999 | 3.05% | n/a |
| £25,000 - £49,999 | 3.30% | n/a |
| £50,000+ | 3.55% | n/a |
* gross/AER rates
** first £70 of interest is tax-free
*** maximum holding in the Ordinary Account is £10,000
- High resolution photographs of Alan Cook, NS&I chief executive, and Gill Cattanach, NS&I commercial director, and images of the Easy Access Savings Account card are available from the NS&I media team - see below for contact details.
- An audio feature is available for radio broadcasts. Contact the NS&I media team for details.
- The Easy Access Savings Account card conforms to the LINK card scheme and current UKIS ATM standards. There are 47,000 LINK machines across the UK. 34,000 are free ATMs and 13,000 in convenience locations where customers may incur a charge for cash withdrawals. Customers will need their card when making deposits and withdrawals over the counter at Post Office® branches and when making withdrawals at ATMs. The card PIN can be changed by writing to National Savings and Investments or by self-selection at Moneybox ATMs.
- The Easy Access Savings Account cannot be opened over the counter at Isle of Man, Channel Islands and British Forces Post Office branches.
- National Savings and Investments is an Executive Agency of the Chancellor of the Exchequer.
- National Savings and Investments' values are security, straightforwardness and integrity, delivered with a human touch.
NS&I media team
Media team
NS&I has a number of spokespeople available for interviews and our experienced radio team is available via our ISDN line: 020 7602 4522.
The numbers below are for media use only.
Customers
wishing to contact NS&I can find details here.
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