National Savings & Investments will reduce interest rates on its income bonds, direct saver and direct Isas products from September.
Income bonds will drop from 1.75 per cent to 1.25 per cent, direct savers will drop from 1.5 per cent to 1.1 per cent and direct Isas will drop from 2.25 per cent to 1.75 per cent.
This change in rates will apply from Thursday 12 September and NS&I will be writing to affected customers at least 60 days in advance.
The organisation said the decision to reduce rates followed a review of comparable rates in the savings market.
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Jane Platt, chief executive of NS&I, said it had been a 'difficult decision' to cut rates.
She said: "Rates across the savings markets have fallen in recent months and to ensure we continue to strike a balance between the needs of our savers, taxpayers and the stability of the broader financial sector, we have taken the difficult decision to reduce rates on our direct Isa, direct saver and income bond accounts."
For more information visit the NS&I website at www.nsandi.com/savings 

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