Post Office Savings Bank

Established in 1861, the Post Office Savings Bank quickly attracted many customers who were eager to find a safe place for their savings. Backed by the Exchequer, the money deposited in the Post Offices was used by the Chancellor, William Gladstone to offset against public spending. This was a simple way for the government to borrow money and thus the POSB could afford to pay a good rate of interest.

This publicity leaflet from 1937 reminds us that the Post Office Savings Bank is 'State Security', ie that the scheme is backed by the government

The aims of the POSB were to:

• Provide a totally secure place for people to save, backed by the Government.
• Provide the Exchequer with a source of funding (i.e. public borrowing).

	By using the network of Post Offices, investors could simply present their savings book over the counter, with a deposit or withdrawal slip, to quickly have access to their money.

Early savings bank books were fawn coloured as in the advert (at the top of this page). Later ones were silver grey colour, but the most familiar was the 'Blue Book' with a plastic cover which was introduced in 1966.

National Savings

In 1969 the first major change happened as the Post Office Savings Bank became a separate government department accountable to Treasury ministers and was renamed National Savings. From this time, local and main Post Offices became simply a distribution outlet for the products of National Savings.

Throughout the decades, National Savings has maintained its policy of matching the government's need for funding with its customers expectations of a safe, secure investment producing a good return.

An Executive Agency

On 1st July 1996 National Savings became an Executive Agency of the Chancellor of the Exchequer. National Savings is still accountable to the Treasury, but the agency status has given them greater control over the day to day running.

Siemens Business Services

In April 1999, more than 4000 staff were transferred from National Savings to Siemens Business Services as part of a 10 year PPP (Public Private Partnership) agreement. This partnership gives National Savings access to new technology and expertise enabling it to remain a key player in the UK investments market.

NS & I

From about 2000, National Savings & Investments was the new name for National Savings, demonstrating that it offered a much wider product range than ever before.

In Earlier Times...

	Department for National Savings SAYE was a Save As You Earn Scheme with contributions automatically deducted from salary. Later schemes were named Yearly Plan. [Similar modern day schemes typically allow purchase of company shares at an advantageous rate, linked to a savings plan.]

The National Savings Movement

	During the first world war (WWI 1914 to 1918) the Goverment needed to both reduce borrowing and to raise funds for the war effort. Consequently, the National Savings Movement was established in 1916 to encourage the British people to 'save and prosper'. Opposite: "With the Grateful Thanks and Appreciation of the Coventry Savings Committee"

Up to Date

Passbook Closes on the Ordinary Account Extract from press release 11th December 2003... "National Savings and Investments (NS&I) plans to launch a new savings account in early 2004. In recent months, NS&I has been investigating a range of straightforward savings solutions to provide the flexibility that meets the needs of today's customers. The new savings account has been created in response to changing customer needs and will be launched in place of the Ordinary Account, which opened in 1861, but has not kept pace with other savings accounts. Ordinary Account customers will be able to use their accounts until July 2004, but will be invited to transfer to the new, more flexible savings account from the end of January 2004."

Image © Damon Hart-Davis

UK National Savings Bank Ordinary Account passbook, outside blue and clear soft plastic with blue stitching.