Buying Premium Bonds for a grandchild is a great gift – with monthly prizes ranging from £25 to £1 million. But National Savings & Investments, which hired a new boss last week, is frustrating many buyers by rejecting their applications and returning their money without giving any explanation as to why they were rejected.
The Mail on Sunday first reported this problem to the state savings bank in January, when Jeff Prestridge, editor-in-chief of Group Wealth & Personal Finance, rejected two of three purchases of Premium Bonds on behalf of his grandchildren and a friend’s grandchild.
The bonds were bought as Christmas gifts, but NS&I said not all orders could be fulfilled because ‘proof of identity requests’ sent to the parents were not completed within the deadline (the country was gripped by postal strikes at the time). It meant not a Premium Bond Christmas present for grandson Archie, but one for Arthur.
It now appears that Prestridge was not the only grandparent or great-grandparent to become frustrated with NS&I’s rigid auditing procedures.
Ian and Elaine Cleg, from Rochdale in Greater Manchester, got caught up in the administrative chaos – not once, but twice.
Miss: NS&I did not say why Elaine and Ian Cleg did not receive Premium Bonds for Poppy and Miller
Ian, 81, and Elaine, 80, give each of their nine great-grandchildren £30 worth of Premium Bonds on their birthdays and at Christmas.
They bought bonds for Summer, 13, Poppy, 9, and Miller, 6. While Summer gratefully accepted her gift and wrote a thank-you letter to her great-grandparents in January, her sister Poppy and brother Miller received nothing.
Elaine was stunned. She says their father, Christopher, had previously provided all the required information as part of the savings organization ID. She called NS&I to ask why it put their money in the bank but only issued bonds for one child.
She says, “I wanted to know what the hell was going on. It was a nightmare just getting through and took half an hour on the phone.
“Then a recorded message kept asking why I wanted to talk about Premium Bonds, but I wasn’t put through to the right department.
“Eventually I got hold of someone, but they talked like it was all my fault.
“Customers should not be held responsible for NS&I service failures.”
In February, the couple finally got the £60 refunded to their bank account – but with no explanation. By now it was time to give Summer another £30 worth of Premium Bonds for her birthday.
At the same time, the great-grandparents again applied for bonds in the names of Poppy and Miller. But their frustrations continued.
While Summer’s application was accepted, Poppy and Miller again received nothing. Elaine says, “The kids talk to each other. They were now beginning to wonder what was going on. Poppy and Miller even thought they might have upset their great-grandparents, resulting in no gifts.”
Failure to issue Premium Bonds given as gifts to children, grandchildren and great-grandchildren is not NS&I’s only fault.
Customers are also experiencing issues with new website security measures designed to stamp out fraud.
Last August, it introduced a two-factor authentication process that requires savers to receive a code before they can make purchases on NS&I’s website.
Social media is flooded with messages from victims of administrative hiccups. Among them is Premium Bond saver Will Hunt.
The 66-year-old property developer from Hitchin, Hertfordshire, says: ‘I was buying bonds online but the computer kept kicking me out for no reason.
“I called NS&I and was told it was having problems with the Google Chrome and Explorer browsers – and that I should try Firefox instead. But I still couldn’t access it. It seemed like a problem with the software.’
Eventually, Will learned that his purchase had gone through.
NS&I and administrative problems go hand in hand. Three years ago it was forced to pay almost £1 million in damages as a result of poor service.
After cutting savings rates to the bone in November 2020, it received more than 40,000 complaints following the call center collapse – with emails and letters going unanswered.
Many customers remain impressed. NS&I’s rating on the consumer review website, Trustpilot, is an all-time low – one star out of five – with the vast majority of reviewers describing the service as ‘poor’. NS&I said Friday that it’s “strange” that siblings living in the same household are not recognized “at the same time.”
Boost: NS&I made five increases to Premium Bond payout rates in the last 12 months
It added: ‘When someone purchases Premium Bonds for the first time, we are required to confirm the identity of the child.
“We are writing to the parent or guardian designated by the purchaser of the bonds asking for confirmation of the child’s full name and date of birth.
If this information is not received within 30 days of purchase, a sale will be automatically refunded to the original method of purchase. This process prevents fraud.’
NS&I CEO Ian Ackerley resigned last month and Dax Harkins was confirmed as the new boss last week.
The price percentage on Premium Bonds is currently equivalent to an annual interest rate of 3.3 percent.
While this falls short of the Bank of England’s base rate of 4.25 per cent, the bonds are still attractive to savers as the odds of winning a prize each month are 24,000 to one with just a £1 stake.
NS&I has made five increases in premium bond payout rates in the past 12 months.
It said, “We continue to review our rates regularly and make changes as needed.”
NS&I say that if you have purchased Premium Bonds and you or your intended recipients have not received confirmation of the gift within 30 days, you should contact the call center on 0808 500 7007.
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