NS&I see savers flee as confidence returns
Government-backed National Savings & Investments (NS&I) said it has been hit by a return in confidence in banks.
The financial crisis led to many British savers withdrawing their funds from banks and choosing safer havens, such as the NS&I.
In the final quarter of 2008, which covered the height of the banking crisis, NS&I reported a 65% rise in new deposits, with £9.55 billion invested.
NS&I, which runs Premium Bonds and a variety of savings products, said that in the past three months, savers have withdrawn more than they have deposit.
However, the NS&I, which sees its profits go to the Treasury, said the current savings environment was “more challenging”.
Meanwhile, in an attempt to lure back savers, banks and building societies are introducing many new savings products – which are well above the Bank’s rate of 0.5%.