National Savings & Investments has today announced a partnership with WHSmith in order to improve customer access to its products.
The State owned investment company plans to distribute information and application forms for Premium Bonds and Inflation-Beating Savings through the high street retailer.
The announcement comes as NS&I begins a new strategy, aimed at building on a current customer base of 27 million people with over £80bn of investments, after completing its previous five-year strategy a year early.
The partnership with WHSmith is due to begin on 1 November 2007, with the Premium Bond and Inflation-Beating Savings Products, and further products will be rolled out from 1 April 2008, depending on customer demand.
NS&I also released its annual results, showing a strong increase in growth after a successful campaign during the 50th anniversary of Premium Bonds. Sales for the year reached £14.17bn, the strongest ever and an increase of 18.2%, after reaching £11.9bn last year. NS&I also reached its 15 year net financing target of £15bn a year early and saved the taxpayer £336.7m through adding value and reducing operating costs.
NS&I claim IFAs are frequently recommending their products, despite paying no commission, and the company hopes to build relationships with IFAs in the future. It also plans to further develop its strong relationships with IFP and PFS.
However, NS&I says it has no plans to facilitate advisor remuneration even if the Retail Distribution Review suggests that customers and IFAs should be able to agree payment throughout the lifetime of a product.
John Prout, NS&I sales director, says: “We have never paid commission or been involved in adviser remuneration and we never will.”
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"A question now needs to be asked of WH Smith and NS&I in view of NS&I’s own comments.
John Prout, NS&I sales director, says: 'We have never paid commission or been involved in adviser remuneration and we never will.'
Are NS&I going to pay WH Smith anything? If so, what is this remuneration called? Is this going to be based on the number of sales as a result of leaflets picked up at their offices (commission) or based on the floor space allocated to the leaflets (distribution). IFAs, banks and others give both distribution and/or advice depending upon the model they operate and the requirements of the client.
If either of the above is so, this is unfair and may end up needing to be referred to the competition commission, FSA, FOS etc and while we are at it, don’t forget NS&I does not have to pay an FSCS levy unlike everyone else (oh of course foreign firms passporting in don’t have to either, my mistake) as IFA and other institutions have not been offered the same, similar or ANY terms for their work by NS&I I think this needs further scrutiny!" Phil Castle, IFA, Financial Escape LtdIFAonline
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