NS&I is raising its Premium Bonds prize fund rate from 3.80% to 4.35% from the September draw, taking the total monthly prize pot close to £500 million.
The government-backed savings bank says there will be more than 308,000 extra prizes up for grabs, including 12 additional £100,000 prizes, 27 more £50,000 prizes and an extra 51 £25,000 prizes. There will also be over 2.3 million £100 prizes in total, and the overall monthly pot will rise by £63 million to more than £497 million.
NS&I is also improving the odds of winning from September, from 22,000 to one to 21,000 to one. The odds were also raised in July.
Caitlyn Eastell, personal finance analyst at Moneyfactscompare, said Premium Bonds may appeal to savers who have used their ISA allowance or are likely to breach their personal savings allowance. However, she cautioned: “Despite the improved odds, they are a game of chance and the 4.35% shouldn’t be mistaken for a headline rate.”
In addition, NS&I is increasing interest rates on 10 savings accounts from today (18 August). The Direct Saver’s rate rises from 3.45% to 3.75% gross/AER, while the Income Bonds rate increases from 3.4% gross/3.45% AER to 3.69% gross/3.75% AER. Rates on fixed-rate British Savings Bonds are also rising by between 0.09 and 0.15 percentage points.