NS&I offered BACS payment of prizes as part of the online/phone registration that appeared in late December 2010.
I did my setup with paper application, I got the letters back from NS&I (passwords & ids), and did the set-up online. The setup online was a bit tortuous, but you get there.
The prize draw is done on the first working day of the month (1 Feb). I got an e-mail on 3 Feb, and the payment turns up on the 9th, within 4 working days (they said 3 days but a day is not serious, especially as it's now cleared funds whereas the warrants used to take 4 days to clear when presented), and within the seventh working day of the month which is what they quote on the website. So, pretty quick and as promised in their time-scales.
Long may it continue!
The reference on the payment in my bank account was: "NS PB PZ PAYS" which is fairly understandable, but they could perhaps come up with something better than that.
Info on the new system is at: http://www.nsandi.com/products/pb/new-ways-to-manage-your-bonds
Allan (no connection with NS&I other than as a customer)