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UK savings provider drops notice period on investment account

UK government-backed savings scheme National Savings and Investments (NS&I) is scrapping the one month notice period on its Investment Account in order to make the account more attractive to savers.

Currently customers need to give one month’s notice to make withdrawals from their Investment Account without penalty, or they can make withdrawals with no notice by accepting a penalty equal to 30 days interest. Approximately 60% of customers take the penalty when making withdrawals from the Investment Account, NS&I said.

From June 1, the notice account will become a straightforward passbook account, making it easier for customers to manage their money, according to the savings and investments provider. Peter Cornish, marketing director for NS&I, said: The Investment Account not only offers a safe home with attractive rates of return but now there is the added benefit of easy access which will appeal to existing and new customers alike.

Competition is fierce among high-street savings accounts, with many banks and building societies offering high rates of interest on linked savings accounts to tempt customers into switching their current accounts. Barclays and Alliance & Leicester both recently introduced a 10% rate on their linked regular saver accounts.