Savers wake up to more bad news this morning as National Savings & Investments (NS&I) announce they have withdrawn their popular Index Linked certificates overnight.
NS&I stopped taking sales via its website and call centre yesterday, postal applications received today (7th September) will be accepted, but any received after today will be returned.
The Fixed Interest certificates have also been withdrawn, although these were not as popular as the Index Linked versions, which provided a tax free return above RPI (Retail Prices Index). Given current rates of inflation the Index Linked accounts looked extremely attractive and were rightly popular.
The certificates had been on sale for four months, having been previously withdrawn in July 2010, and their withdrawal now will be seen as a blow for savers who are struggling to find accounts which pay interest high enough to beat inflation.
After their reintroduction in May sales have been strong, NS&I, chief executive, Jane Platt said: “During the almost four months that savings certificates have been on sale, there have been approaching 500,000 transactions into the latest issue of Index Linked savings certificates.”
She continued: “Over this period, we’ve seen significant amounts of money invested into these products. To ensure that we do not exceed the upper end of our net financing target range, we’ve taken the decision to withdraw savings certificates from general sale at this point.”
Although sales to new savers have been stopped immediately, they will still be available for existing savers. This means people who already hold Index Linked certificates will be able to roll them over into a similar product.
Inflation linked savings
The Index Linked certificates were popular, not only did they produce a guaranteed return above inflation, the interest was tax free for all. It was also possible to get access to savings within the five year term.
There are other savings accounts available with interest linked to RPI, however only a small number of these are available in a Cash ISA and non allow you access to your money before the end of the term without penalty.