Service to NS&I's customers has improved

1.15  NS&I has up to 30 million customers, more than any other UK retail financial provider. Before the contract with SBS, NS&I's target time to respond to customer requests was nine days. SBS has reduced the response time from seven days to three days while maintaining the standard of accuracy required by NS&I. As customer service is critical to NS&I, it has appointed a dedicated Customer Services Manager to act as a "Consumer Champion" and Intelligent Customer to monitor SBS delivery to customers. As Figure 3 shows, customers now have direct access to NS&I 24 hours a day. NS&I has launched new products and developed the website and capability for customers to purchase products via the website.

3		New products and channels have been established
		In 1999 NS&I launched ISAs, Tessas and Fixed Rate Savings Bonds. Although NS&I was well on the way to launching ISAs when SBS took over, it considers that the product would not have been launched in time for the April 1999 deadline, without the partnership. Similarly, the launch of Fixed Rate Savings Bonds in October 1999 would have been delayed.		Originally established as a contact and service centre, NS&I's call centre also became a sales centre in January 2002. Customers can call NS&I on a single number 24 hours a day, 365 days a year. Customers can buy many products over the phone using a debit card or request repayments directly into their bank or building society accounts. Telephony is proving to be a popular and successful channel. The call centre received 1.7 million calls from customers in 2001-02, 57 per cent more than received in the previous year. Currently, around 10 per cent of calls result in sales. This year the call centre is on target to receive over two million calls with the number of transactions carried out by phone forecast to rise significantly.
		In 2002 NS&I launched the Guaranteed Equity Bond, its first equity-linked investment product offering returns linked to the stockmarket and 100 per cent security of the customer's original investment. Total sales of the first two issues of the bond exceeded expectations at more than £160 million. NS&I has enhanced existing products. For example, Savings Certificates and Pensioners Guaranteed Income Bonds are now available over shorter terms. Customers have greater choice and the business benefits as the demand for repayments on fixed term products is spread more evenly over time.		NS&I introduced a new website in July 2002. It allows customers to purchase products on-line, and check Premium Bond prizes, among other functions, with more planned in the future. Customers can still contact NS&I or buy its products at the Post Office's 17,000 branches, by post, or through financial intermediaries.
		Source: NS&I

1.16  In April 2001, for the first time, NS&I published a Customer Code, setting out the standards of good practice customers can expect when dealing with it. This will be subsumed into the Banking Code8, which NS&I subscribed to on 1 March 2003. The implementation of this code is a huge project for SBS given the size of NS&I's customer base. NS&I is paying the costs of meeting the terms of the codes as SBS was not required by the contract to deliver these codes. NS&I anticipates costs of the Customer Code will be some £3 million during the first year, following a one-off data capture exercise covering more than 11 million customer records costing £4 million. NS&I estimates that subscription to the Banking Code will cost £20 million over seven years. Much of the cost relates to the need for SBS to mail a significant number of customers on an annual basis.

1.17  On 11 February 2002, National Savings relaunched as National Savings & Investments to reflect the modernisation of the business through its partnership with SBS and its new focus on customers. The launch attracted media attention and some quarters criticised the £2 million cost of the exercise, although the cost of the new image was absorbed in NS&I's existing marketing and running costs budgets. NS&I is assessing and will continue to assess the impact of its new image with Market and Opinion Research International (MORI). Research conducted to date suggests a positive customer response.

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8  The Banking Code is a voluntary code which sets standards of good banking practice for banks and building societies to follow when dealing with personal customers in the UK.