NS&I has raised rates for its British Savings Bonds products; with the two, three and five year options all now paying above 5%.
The new issues of its British Savings Bonds Guaranteed Growth Bonds and Guaranteed Income Bonds were released to new and maturing customers this week.
British Savings Bonds offer investors a guaranteed interest rate for fixed terms of 1, 2, 3 or 5 years. Funds cannot be withdrawn early.
The minimum investment is £500, with a maximum investment of £1m.
The new rates for the British Savings Bonds are:
- The new interest rate on the 1-year Growth option is 4.99% gross/AER, and the Income option is 4.88% gross/4.99% AER.
- The new interest rate on the 2-year Growth option is 5.07% gross/AER, and the Income option is 4.96% gross/5.07% AER.
- The new interest rate on the 3-year Growth option is 5.10% gross/AER, and the Income option is 4.99% gross/5.10% AER.
- The new interest rate on the 5-year Growth option is 5.17% gross/AER, and the Income option is 5.06% gross/5.17% AER.
The increases are the fourth time NS&I has raised rates on its fixed rate savings accounts since June.
The rise is no surprise as savings rates have been rising across the board at many providers in recent weeks.
Separstely, Investec Save increased the rates on its 2 and 3 year fixed rate saver accounts at the end of September. Its 3-Year Fixed Rate Saver now pays 5.19% AER (a 0.17% increase) while the 2-Fixed Rate Saver pays 5.16% AER (a 0.14% boost).
Sarah Coles, head of personal finance at AJ Bell, said: “NS&I is stepping up its game to compete in a tough market. It’s boosting the rates on its fixed rate bonds for the fourth time in less than four months. They’re pretty substantial hikes too, which put them within shouting distance of the best on the market. It’s a sign of just how hard the organisation is having to work to attract cash.
“NS&I has a duty to balance the needs of savers with those of taxpayers, so they are careful not to over-pay. However, they are pushing harder than they usually do. The three-year rate is now among the top 10 most competitive in the market, while the fixed rates for other periods are in the top 20.”
NS&I is one of the largest savings organisations in the UK, offering a range of savings and investments to more than 24 million customers. All products offer 100% capital security as NS&I is backed by the Treasury.
NS&I’s unaudited results for the first quarter (April-June 2026) of the financial year 2026-27 show that NS&I delivered £1bn of net financing to the Government.
The Spring Forecast in March 2026 set NS&I’s Net Financing target for 2026-27 at £15bn (+/- £4 billion), £2bn higher than the target for 2025-26.