NS&I have revealed this morning that the Premium Bonds prize fund rate will increase from 4% to 4.65% from its September draw – reaching the highest level since March 1999 and adding £66 million to the prize fund
Also, NS&I have announced that the Premium Bonds odds to win will improve to 21,000 to 1 from 22,000 to 1 – their best level since the April 2008 prize draw
Interest rates for Income Bonds, Direct Saver, Direct ISA, Junior ISA and Investment Account are all set to be increased from 18 August as the statement below shows in more detail.
Millions of customers across the country will see a boost to their savings as NS&I announces upcoming interest rate increases across its variable products. This includes the Premium Bonds prize fund rate, which will increase to 4.65% from 4.00%, the highest level since March 1999. Savers holding Income Bonds, Direct Saver, Direct ISA, Junior ISA and Investment Account will also benefit from the rate increases announced today.
The increase to the Premium Bonds prize fund rate will come into effect from the September 2023 prize draw, whilst customers holding Income Bonds, Direct Saver, Direct ISA, Junior ISA and Investment Account will see their savings boosted from 18 August.
At the end of July, NS&I announced increases to the rates of interest paid on their fixed rate products
NS&I Chief Executive, Dax Harkins, said:
“These upcoming increases show that we’re supporting savers up and down the country. Premium Bonds are one of the nation’s favourite savings products, so increasing the prize fund rate to its best level since 1999 and improving the odds means that more people will have the chance to win prizes each month.
“These rate increases will help ensure that our savings products remain attractive to customers, whilst ensuring that we continue to balance the needs of savers, taxpayers and the broader financial services sector.”
Highest Premium Bonds prize fund rate since 1999
From the September 2023 prize draw, the prize fund rate will increase to 4.65% from 4.00%, its highest level since March 1999. The odds will improve to 21,000 to 1, their best level since the April 2008 prize draw.
The change in odds will see an estimated extra £66 million added to the prize fund next month, with a potential prize pot of over £470 million. NS&I estimates that there will be 5,785,904 prizes up for grabs from September – an increase of more than 269,000 when compared to August 2023.
Increases to other variable products
NS&I is also increasing interest rates on its Income Bonds, Direct Saver, Direct ISA, Junior ISA and Investment Account.
The interest rate paid to Direct Saver customers will increase to 3.65% from 3.40%, whilst the interest rate paid to Income Bonds will increase to 3.59% gross/3.65% AER from 3.40% gross/3.45% AER.
The rate paid on NS&I’s Direct ISA will increase to 3.00% tax-free from 2.40% tax-free. Young savers will also benefit, with the rate that NS&I pays on its Junior ISA increasing to 4.00% tax-free from 3.65% tax-free.
Also effective from 18 August, NS&I will be increasing the interest rate that it pays on its Investment Account to 1.00% from 0.85%.
Current and new Premium Bonds prize fund rate and odds
| Prize fund rate for August 2023 prize draw | Odds for August 2023 prize draw | New prize fund rate (from September 2023) | New odds (from September 2023) |
| 4.00% tax-free | 22,000 to 1 | 4.65% tax-free | 21,000 to 1 |
Number and value of Premium Bonds prizes
| Value of prizes in August 2023 | Number of prizes in August 2023 | Value of prizes in September 2023 (estimated) | Number of prizes in September 2023 (estimated) |
| £1,000,000 | 2 | £1,000,000 | 2 |
| £100,000 | 77 | £100,000 | 90 |
| £50,000 | 154 | £50,000 | 181 |
| £25,000 | 307 | £25,000 | 360 |
| £10,000 | 769 | £10,000 | 902 |
| £5,000 | 1,538 | £5,000 | 1,803 |
| £1,000 | 16,182 | £1,000 | 18,832 |
| £500 | 48,546 | £500 | 56,496 |
| £100 | 1,874,218 | £100 | 2,339,817 |
| £50 | 1,874,218 | £50 | 2,339,817 |
| £25 | 1,700,728 | £25 | 1,027,604 |
| Total£404,560,900 | Total5,516,739 | Total£470,827,650 | Total5,785,904 |
Variable rate savings products
| Product | Current interest rate (until 17 August) | Interest rate from 18 August 2023 |
| Direct Saver | 3.40% gross/AER | 3.65% gross/AER |
| Income Bonds | 3.40% gross/3.45% AER | 3.59% gross/3.65% AER |
| Direct ISA | 2.40% gross/AER | 3.00% tax-free/AER |
| Junior ISA | 3.65% gross/AER | 4.00% tax-free/AER |
| Investment Account | 0.85% gross/AER | 1.00% gross/AER |
