Premium Bonds 'more enticing' rates update as NS&I makes account changes

As the prize rate for Premium Bonds is increasing very soon, customers may wonder if more positive changes from NS&I are on the way. You can win big prizes in the monthly prize draw, with top prizes on offer for amounts such as £50,000 or £100,000, or you could even scoop a £1million jackpot.

Both your chances of a win and the total prize fund on offer is increasing from July. NS&I announced previously it would boost the prize fund rate from the July draw, up from 3.3 per cent to 3.8 per cent.

The odds of winning for each £1 Bond are also moving up, from 23,000 to one to 22,000 to one. In more happy news for NS&I customers, the savings group has said it is increasing its rate across its fixed term British Savings Bonds and also for its Green Saving Bond.

Given the upward trends for NS&I products, savers may ask if more increases to the prize fund rate could be announced soon. George Sweeney, investing expert at comparison site Finder, said it's difficult to know for sure.

He said: "We could also see some future changes to the underlying prize rate for Premium Bonds, which are already due to rise from 3.3 per cent to 3.8 per cent for the July draw and beyond. The Bank of England (BoE) base rate decisions will have some influence; however, it's not an exact science.

"The reason being, NS&I operates slightly outside the rest of the savings market due to its unique underlying goal of raising funds for the Government, instead of simply trying to make a profit or compete with other saving institutions." NS&I is a state run institution and is given net financing targets by the Government to accrue cash for the Treasury.

Its target is currently £15billion for the 2026/2027 tax year. It's worth noting that the Green Savings Bonds are not subject to this financing target. These products were launched in 2021, to help fund green Government projects across the UK.

Looking at what could influence where NS&I decides to set the Premium Bonds rate, Mr Sweeney said: "If the Bank of England interest rate landscape looks like we'll stay higher for longer, it's more likely we'll see more enticing Premium Bond prize fund rates later in the year.

"But, it all depends on how the current strategy progresses, because if NS&I raise funds at a faster rate than expected, lifting the prize fund rates for Premium Bonds would actually hinder rather than help it achieve its mandate of raising money, but not too much."

As announced on June 23, these are the new bond issues on offer from NS&I: