Catalogue description Post Office: Savings Bank, Insurance and Investment Services

The Savings Bank was established by the Post Office Savings Bank Act 1861. This act empowered the Postmaster General to receive money on deposit, to make repayments, and to pay interest at the rate of two and a half per cent per annum on the balance outstanding to the credit of depositors. The Bank opened for business on 16 September 1861 using the already existing system of 301 Post Office Money Order offices and with 1,700 Post Offices acting as its local agents for deposit and withdrawal transactions. This quickly grew to 2,300 Post Offices. As the first institution of its kind in the world its success was immediate. The minimum deposit needed to open an account was fixed at one shilling.

In 1861 the Savings Bank had twenty four thousand account holders and a staff of 200. By 1871 there were 1,300,000 accounts and the total sum on deposit was 15 million. The original system of manual book keeping lasted until 1926. Services were extended to include: government stocks and bonds in 1880; insurance and annuities in 1888; war savings certificates in 1916; (Renamed National Savings Certificates in 1920); premium savings bonds in 1956; investment accounts in 1966 and a Save as You Earn contractual scheme in 1969.

In the mid 1960s as part of a general government policy to disperse staff from London, the Savings Certificate Division relocated to Durham, firstly into temporary accommodation then into a new purpose built office block. The move was completed by 1969. Other parts of the Savings Bank dealing with Ordinary and Investment accounts moved out of London to Glasgow. The Department was renamed 'Department for National Savings' in 1967.

In 1969 the Department had a staff of over 14,000. By 1988, thanks largely to mechanisation and computerisation, this had been reduced to nearly half this size.

When The Post Office ceased to be part of the Civil Service in 1969 and became a Public Corporation, the Savings Bank remained with the Civil Service and started a new life as a Public Corporation. The Post Office continued handling savings transactions over the counter on an agency basis.