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UK's National Savings & Investments bank looks for new IT partner in £172m deal
Outfit behind Premium Bonds wants fresh start after 25 years with Atos
UK state-owned bank National Savings & Investments (NS&I) is on the hunt for an IT partner – with a deal worth up to £172m in the offing – as its longstanding arrangement with Atos IT Service draws to a close.
The Executive Agency of the Chancellor of the Exchequer is looking for an IT services company to "deliver digital self-service experiences and journeys to NS&I's retail banking customers, and to enable Assisted Digital support. It will deliver these services to mobile app, website and voice assistant channels," according to a tender notice.
NS&I serves around 25 million people and manages funds worth £202bn. It is best known for providing Premium Bonds, a form of investment that also offers winnings under a lottery system, an approach designed to persuade people to accrue long-term savings which dates back to 1956.
The competition is intended to help continue the bank's transition into the age of online and mobile-first engagement with customers.
"NS&I has transitioned from branch-based banking to our current state as a direct-only business with digital, post and phone channels. This package is intended to bring us to the endpoint of that trajectory, transitioning to a digital first, self-service retail bank, with Assisted Digital support for customers unable to self-serve," the tender notice says.
The contract is expected last up to 56 months with an option to extend for another two years.
Atos currently provides its core IT services under a deal set to close on 31 March 2024. Its replacement is being procured in chunks.
Last year, the bank launched a competition to find a supplier to help create "high-level solution architectures, detailed solution designs, and systems integration required to deliver NS&I's end to end services," a tender notice said at the time. The contract is expected to have a one-year implementation period plus a five-year operational term.
The relationship with Atos dates back more than 20 years, in some form or other. In 1999, the bank transferred its operations to Siemens Business Services under a public-private partnership deal, which "appeared to be good value for money," according to the National Audit Office.
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However, "Siemens Business Services and NS&I underestimated the challenge involved. Siemens Business Services has encountered a number of problems and so is unlikely to make its projected returns on the project," the NAO said in a 2003 report.
In 2014, NS&I signed deal with Atos, which, including a 2019 extension worth £305m, is valued £1.1bn.
NS&I built ERNIE, one of the world's oldest business computers, with help from engineers Tommy Flowers and Harry Fensom who were also behind Alan Turing's war-time Colossus code-breaking machine.
The ERNIE – Electronic Random Number Indicator Equipment – is the machine used to crank out millions of random numbers when the Post Office, and now NS&I, selects the winning Premium Bonds each month.
The first ERNIE drew 2,000 numbers every hour, which meant doing the full draw of 65,000 numbers took near enough three days. Each of the first four iterations of ERNIE used thermal noise to produce random numbers. In 2019, the government unveiled ERNIE 5, which is powered by quantum technology. ®