Receive up to 4.69% AER with NS&I’s new British Savings Bonds

NS&I increases rates across its fixed bond products – but how do they compare?

As of 23 June, National Savings and Investments (NS&I) increased interest rates on its British Savings Bonds Guaranteed Growth Bonds and Guaranteed Income Bonds.

The new one-year Growth and Income bonds offer competitive rates of 4.69% AER, with the two- and three-year counterparts paying a slightly lower 4.67% AER and 4.65% AER, respectively. Meanwhile, those looking to lock in a fixed rate for longer will find the provider’s five-year bonds now offer 4.55% AER.

Guaranteed Growth Bonds pay interest on anniversary, whereas the Guaranteed Income Bonds pay it monthly.

The latest issues are available to new and maturing customers and can be opened online with a minimum deposit of £500, after which savers can’t make any further additions. For this reason, they may want to consider their opening amount carefully. As is typical of fixed bonds, early access isn’t allowed.

What’s more, NS&I also launched a new Green Savings Bond today.

Looking for eco-friendly saving?

For those wanting an eco-friendly option, NS&I’s new Green Savings Bond pays 4.45% AER. To open this three-year fix online savers will need to deposit £100 or more, and once again neither further contributions nor early access are permitted.

Opening a Green Savings Bond helps raise funds for green projects as part of the UK Government Green Financing Framework. This means that HM Treasury will allocate an amount equivalent to the money raised from Green Savings Bonds to its chosen green projects within two years.

However, bear in mind that several accounts on our chart qualify as green products and to identify these look out for the green leaf symbol.

How do the British Savings Bonds compare?

“Savers who prefer to keep their pots with NS&I will be delighted to see rates increase, but it is worth noting that the top rates can be beaten,” Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, commented.

While products from NS&I often have widespread appeal because of their Government backing, there are higher returns available. Those willing to forgo the top rates may appreciate the complete guarantee of their money’s protection, however, standard accounts still cover up to £120,000 under the Financial Services Compensation Scheme.

“There are expectations for interest rates to stay higher for longer, so it is important that NS&I offers a fair rate but not lead the market outright. Generally, interest rates on savings accounts have been increasing, so now is an ideal time to check the latest deals on the market and review any old pots,” Springall explained.

“Interest rates could well increase further this year, unfortunately it’s a bit hard to tell by how much. Expectations are currently driven by concerns over high inflation, so anyone looking at fixed accounts might feel reluctant to lock in,” she continued.