National Savings and Investments (NS&I) has launched new Issues of its popular 2, 3 and 5-year British Savings Bonds, offering fixed returns for customers seeking security amid ongoing market fluctuations.
In a further update for savers, NS&I has also announced a new interest rate for its Junior ISA, effective from July 18, 2025.
The new products come as NS&I continues to balance the needs of savers, taxpayers, and the broader financial services market.
Andrew Westhead, NS&I Retail Director, said: "Today’s announcement is in response to changes in the wider market and will ensure we continue to offer a range of fixed-term options while balancing the interests of savers, taxpayers and the broader financial services sector.
Here are the key changes savers need to know:
British Savings Bonds - Guaranteed Growth Bonds:
- 2-year Growth Bond: 3.85 per cent gross/AER (previously four per cent)
- 3-year Growth Bond: 3.88 per cent gross/AER (previously 4.10 per cent)
- 5-year Growth Bond: 3.84 per cent gross/AER (previously 4.06 per cent)
British Savings Bonds - Guaranteed Income Bonds:
- 2-year Income Bond: 3.79 per cent gross / 3.85 per cent AER (previously 3.93 per cent gross / four per cent AER)
- 3-year Income Bond: 3.82 per cent gross / 3.88 per cent AER (previously 4.03 per cent gross / 4.10 per cent AER)
- 5-year Income Bond: 3.78 per cent gross / 3.84 per cent AER (previously 3.99 per cent gross / 4.06 per cent AER)
Andrew Westhead is the NS&I; Retail DirectorNS&I;There is no change to the 1-year British Savings Bond, which remains at 4.05 per cent gross/AER for the Growth option and 3.98 per cent gross / 4.05 per cent AER for the Income option.
In addition, the interest rate on NS&I’s Junior ISA will change from July 18 2025:
Junior ISA:
- New rate: 3.55 per cent AER (tax-free) (previously four per cent AER)
The Junior ISA allows savers under 18 to benefit from tax-free savings, with the new rate reflecting NS&I’s "ongoing commitment to helping young people save for their future."
The Junior ISA allows savers under 18 to benefit from tax-free savings
GETTYGuaranteed Growth Bonds and Guaranteed Income Bonds require a minimum investment of £500 and accept a maximum of £1 million per person per Issue.
The funds are locked in for the chosen term of 1, 2, 3, or 5 years and cannot be withdrawn early.
At maturity, savers can withdraw their funds or choose to reinvest.
There will be fewer high-value tax-free prizes available for the August Premium Bonds prize draw, however the odds of winning stay the same
NS&IThe news follows announcements from NS&I that the Premium Bonds prize fund rate will be cut within months.
The prize fund rate will be reduced from 3.8 per cent to 3.6 per cent from the August 2025 prize draw.
The change means there will be fewer high-value tax-free prizes available however the odds of winning stay the same.
More than six million prizes will still be paid out in the August draw, but several prize categories will see a drop in the number of winners.
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