NS&I to bar Scottish savers if they vote for independence

Savers living north of the border will no longer be able to invest in Premium Bonds or other NS&ampI accounts below ‘overseas’ buyer guidelines

  Photo: Getty Images

National Cost savings &amp Investments has mentioned that in the event of Scottish independence individuals residing north of the border – unless of course they have a financial institution account with an institution then on the south side – will no longer be in a position to invest in Premium Bonds or other NS&ampI accounts.

Traders could preserve their existing holdings, but new income would have to be turned away.

NS&ampI, which is exclusive in becoming regulated right by the Treasury rather than by other financial authorities, said its guidelines would require to alter if it have been to permit savers in an independent Scotland to invest fresh money. At the minute only non-resident savers with a United kingdom bank account can save with NS&ampI, although they are excluded from owning Isas.

A spokesman mentioned: “In the occasion of Scottish independence recent principles would stop any person with only a Scottish bank account from purchasing NS&ampI merchandise.”

It follows a week in which analysts at UBS, the worldwide financial institution, warned that savers would get cash out of Scottish economic institutions if there have been a vote for independence in September’s referendum. “Where there is even a likelihood that Scotland could have something other than total monetary union [it] is most likely to be perceived as the weaker component of the sterling area,” UBS explained, concluding that this could lead to “savings shifting rapidly”.

What this would suggest in practice is a matter of speculation as all significant banks’ consumers are cross-border. UBS also said it “did not seem to be feasible that RBS or Lloyds could continue to be Scottish firms in the occasion of a ‘yes’ vote.” Neither bank has made clear its plans in the event of Scottish independence.

Uncertainty close to the protection of their savings has previously seen depositors flock to NS&ampI, as for the duration of the banking crisis of 2008, when the institution had to get action to discourage further inflows.

NS&ampI has recent experience of turning away consumers. Following the introduction of challenging new US tax laws, requiring other countries’ finance firms to gather details on behalf of the US taxman, it will shut 2,700 US customers’ accounts. Some had been closed on July 1. It stated it took the step since the administrative costs had been regarded as “disproportionate”.

Scotland’s Potential, the White Paper published by the Scottish Government in November, referred to the creation of a Scottish version of NS&ampI, saying: “Independent Scottish governments would have the option of borrowing from Scottish citizens via a Scottish nationwide savings and investments perform. Nonetheless, with minimal rates of interest prevailing, this is unlikely to be an early priority.”

[Up to date July 12, 15.40]