NS&I boss apologises for customer service amid rise in withdrawals

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The boss of Britain’s state-owned savings bank has apologised for dismal customer service levels following a surge in withdrawals, saying the bank struggled to cope with “unprecedented” demand and a drop in staffing linked to the pandemic.

In a letter to MPs on the Treasury committee, National Savings & Investments chief executive Ian Ackerley said the bank was opening four new call centres to help cope with demand, after big cuts in its bond prize payouts and savings rates left customers scrambling to pull their cash.

NS&I, which runs a monthly prize draw for premium bond holders, is also pausing a controversial decision to stop sending physical cheques to winners that had caused anxiety for some elderly and vulnerable savers. The move contributed to a 43% jump in complaints in the six months to September.

“I am very sorry for those customers who experienced poor service last year and I am determined to return NS&I to delivering the high quality service our customers have been accustomed to for many years now,” Ackerley said.

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However, the decision has come too late for some savers who pulled £26.5bn from the bank in the final three months of 2020. NS&I warned it was likely to be more than £9.5bn short of its £35bn full-year funding target by March.

Conservative MP and Treasury committee chairman Mel Stride said: “The damage that may have been done to NS&I’s reputation over the last few months is worrying. NS&I has a big role to play in helping the government fund the costs of the coronavirus recovery scheme and it will need to work hard to win back customers.”

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NS&I has been under pressure to raise around £35bn to help support government borrowing during the Covid crisis, up from its previous £6bn target.

While it initially attracted savers who had built up nest eggs during lockdown, a cut to payouts sparked a wave of withdrawals. Acklerley said NS&I started to fall behind on calls and withdrawal requests as staff fell ill, were forced to shield or had to take care of family.

Meanwhile, its back office sites in India were forced to close at least three times between March and June. “This has had a significant impact on the processing of bereavement claims, general correspondence and complaints,” Ackerley said. NS&I has since brought those operations back to the UK.