NS&I 2014-15 results – Business goes 100% direct to satisfy customer demand and maintain efficiency
Strong customer demand for online services, growth of mobile usage across all age ranges
- Agreement to sell Premium Bonds through the Post Office comes to an end
- Commitment to customer choice of direct channels – phone, online and post
- NS&I met all its customer service and satisfaction targets in 2014-15
Customers move online and mobile
NS&I met all of its customer service and satisfaction targets in 2014-15, handling over 22 million interactions online. In December 2014 NS&I launched a new customer service Twitter feed, @nsandihelp. This was followed in January 2015 by a new website which is easier to use and mobile-friendly. Almost 65% of interactions with NS&I’s customers are now done online or through our 24 hour call centres. 2015-16 will see NS&I focus on encouraging more customers to do business through its digital channels including through mobile applications, reflecting changing patterns of consumer preferences across all age ranges.
Direct only business
From 31 July 2015, NS&I’s contract with the Post Office for Premium Bond sales comes to an end and all NS&I business will be direct; via 24 hour call centres, online through nsandi.com, by post or by electronic transfer. These methods are already used by the majority of Premium Bond customers. This change reflects NS&I’s commitment to serving its customers directly, and to operating as cost effectively as possible, in order to deliver significant savings to the taxpayer. NS&I will be writing to customers who have bought Premium Bonds from the Post Office in the last year to let them know about the change.
Delivering the Chancellor’s Budget measures for savers
65+ Bonds, launched by the Chancellor of the Exchequer in his March 2014 Budget, went on sale in January 2015 and went on to become the biggest selling retail financial product in Britain’s modern history. In total over one million savers invested over £13 billion in the bonds, through NS&I’s direct channels. In addition, NS&I successfully delivered an increase in the Premium Bond investment limit from £30,000 to £40,000 in June 2014 and the return of a second £1 million monthly jackpot prize from August 2014. On 1 June 2015, NS&I raised the maximum investment limit again to £50,000.
Strong partnership and business-to-business services
NS&I began a new outsourcing contract with Atos on 1 April 2014 and exceeded targets of 95% in operational delivery (achieving 98%) and 97% online availability (achieving 98%) in 2014-15. Going forward the contract will deliver additional value through more challenging targets. Another way that NS&I is reducing costs and becoming increasingly self-funded is through business-to-business services. As well as continuing to deliver the Equitable Life Payment Scheme, which has paid out more than £1 billion, NS&I has agreed a seven year contract with the Court Funds Office and will also manage payment processing for the Home Office for an additional 18 months, delivering significant savings for its clients across government.
NS&I’s Value Indicator measure tracks the cost to government of raising funding through NS&I against the cost of raising funds though the gilt market – a positive figure shows that NS&I is the more cost-effective route. NS&I delivered £330 million of value in 2014-15 – in spite of gilt yields falling to historically low levels in early 2015.
NS&I’s Net Financing target for 2015-16 is £10 billion in a range of £8 to £12 billion. This includes 65+ Bonds sales in April and May 2015. NS&I’s Net Financing target for 2014-15 was £13 billion in a range of £11 to £15 billion. In December 2014 NS&I’s forecast was that it would deliver £13.5 billion of Net Financing, however the unprecedented demand for 65+ Bonds in the final quarter saw NS&I deliver £18.2 billion, exceeding the target range.
Jane Platt, Chief Executive, NS&I, said:
“2014-15 has been a unique year for NS&I. 65+ Bonds have allowed over one million older savers to invest more than £13 billion through our direct channels. We’ve increased the Premium Bond investment limit to £40,000 and now to £50,000 and we’ve continued to enhance the services we offer our 25 million customers across our product range. We’ve also made important efficiencies across our business and strengthened our contract with Atos in order to deliver better value for taxpayers.
“As our relationship with the Post Office comes to an end on 31 July this year, I would like to thank them for the support and service they have given our customers over the years and wish them every success for the future. The majority of our customers already use direct channels to buy their Premium Bonds, and so moving to 100 per cent direct sales is a natural next step for NS&I. It should also be intuitive and straightforward for these customers given that they already manage and repay their Premium Bonds with us directly.
“After such a long-standing relationship we know it’s important that we help our customers with the transition. We’ll be writing to those who have recently bought Premium Bonds through the Post Office to let them know about the end date on counter sales and to assist them with using our direct channels for purchases from 1 August. We’re very proud of our customer service, which consistently gets high satisfaction scores, and look forward to using our range of channels for existing and new customers.”
Key facts on Premium Bonds sales through the Post Office
- NS&I separated from the Post Office in 1969. Since this time NS&I and Post Office Limited have operated as independent businesses.
- Premium Bonds cannot be cashed in or managed through the Post Office. The existing agreement with the Post Office is solely for Premium Bond sales.
- Our mission is to help reduce the cost to the taxpayer of Government borrowing now and in the future. In order to fulfil this, NS&I is committed to ensuring that it operates cost effectively whilst meeting customers’ needs.
How to buy Premium Bonds
- Apply by phone – call any time on 0500 007 007 (check number before release)
- Apply online – visit the NS&I website http://www.nsandi.com/premium-bonds
- Apply by post – complete an application form available from NS&I and post it back to NS&I. Customers can download and print a form from nsandi.com or call NS&I 24 hours a day 365 days a year, to request a form.
- Direct transfer from your bank account – if you already have some Premium Bonds and know your holder’s number, a quick and easy way to buy more Bonds is to make a transfer from your bank account
2014-15 annual results
|Year||Gross inflows||C&AIP*||Gross outflows||Net Financing||Total stock||Value indicator|
|2014-15 (including Q4)||32.3||1.6||15.7||18.2||123.9||0.3|
*C&AIP is capitalised and accrued interest and prizes earned. All figures are in £ billion and subject to rounding.
NS&I reports quarterly on gross inflows and outflows, Net Financing and total stock. Each quarter, NS&I release unaudited figures and publishes its audited Annual Report and audited accounts each financial year. NS&I’s full Annual Report and Accounts and Product Accounts.
LINK TO ANNUAL REPORT AND ACCOUNTS PAGE TBC
Notes to Editors
- NS&I is one of the largest savings organisations in the UK, offering a range of savings and investments to more than 25 million customers. All products offer 100% capital security, because NS&I is backed by HM Treasury.
- Net Financing – the measure of the net change of NS&I funds, meaning total inflows from deposits, retention of maturing monies and capitalised and accrued interest, less the total outflows from withdrawals and interest or Premium Bonds prize draw payments. A positive Net Financing figure represents a positive contribution to government financing.
- Value Indicator – an indication of NS&I’s cost-effectiveness in raising finance for the Government. It compares the total cost of delivering Net Financing and servicing existing customers’ deposits with how much it would cost the Government to raise funds through the wholesale market via equivalent maturity gilts. 65+ Bonds are not included in the Value Indicator target. As they were a specific Budget measure, the cost for delivering them was set out in the 2014 and 2015 Budget scorecards.
- For further information, or to interview Jane Platt, please contact the NS&I media team.