NS&I boosts Premium Bonds prize fee with ‘extra probabilities to win’
The rates are changing across several NS&I savings accounts
NS&I has announced some changes to Premium Bonds prizes(Image: Getty)
NS&I has announced it will shortly be increasing the Premium Bonds prize fund rate as well as increasing the odds of winning. The provider has also announced changes to its other savings rates.
The provider has said that from the July draw, the prize fund rate for Premium Bonds will go up from the current 3.3 per cent up to 3.8 per cent. This comes not long after NS&I cut the prize rate from 3.6 per cent down to 3.3 per cent, from the April draw.
The odds of winning for each £1 Bond will also be increasing from July, going up from 23,000 to one to 22,000 to one. This represents a quick bounce back to previous levels, as NS&I reduced the odds of winning from 22,000 to one to 23,000 to one from the April draw.
NS&I says some 22 million Premium Bonds holders will benefit from the change, as their chances of a win go up. Thanks to the uptick, there will be an extra 322,000 prizes in the July draw compared to May, with an extra £60,000 in the total prize pot.
This is expected to include 12 more £100,000 prizes, an extra 24 prizes for £50,000, along with 49 more £25,000 prizes. Each monthly prize draw will continue to have the two £1million jackpot prizes as ever.
‘More rewarding’
Greig Bingham, head of financial modelling at financial services consultancy Broadstone, said the changes are good news for customers. He said: “NS&I is clearly looking to make Premium Bonds more attractive again following the reductions announced as interest rates dropped.
“What is also notable is the shift in the make-up of prizes. While the total number of prizes is increasing significantly, the proportion of £25 prizes – the smallest available – has fallen from 47 per cent of all prizes to 37 per cent. That means a greater share of the prize fund is being directed towards higher-value prizes, which could make the product feel more rewarding for savers fortunate enough to win.”
In announcing the changes, NS&I retail director Andrew Westhead said: “We regularly review our products to ensure they reflect current market conditions, and we’re pleased to be able to improve rates across five variable savings accounts today. This reflects changes in the wider savings market and helps ensure we meet our Net Financing target.
“Premium Bonds offer the monthly excitement of tax-free prizes with 100% security backed by HM Treasury, and the flexibility to withdraw at any time. So, I’m pleased that from July we can improve both the prize fund rate and the odds meaning even more chances to win for our 22 million Premium Bonds holders.”
Other savings rates increases
NS&I has also announced it is increasing the rates across four of its savings accounts. The new rates will take effect from today (May 14).
These include:
- Direct Saver – 3.45 per cent (up from 3.05 per cent)
- Income Bonds – 3.4 per cent (up from 3.01 per cent)
- Direct ISA – 3.8 per cent (up from 3.5 per cent)
- Junior ISA – 3.7 per cent (up from 3.5 per cent).
