NS&I is reducing its Premium Bonds prize fund rate again.
The prize fund rate is being reduced from 4.00% to 3.80% from the April 2025 draw. Premium Bonds are a savings product, but instead of getting a guaranteed rate of interest, you’re entered into a monthly prize draw. The smallest prize you can win is £25 and the biggest prize is £1million.
But winning isn’t guaranteed, and some months, you may not win anything at all. The prize fund rate is the closest thing Premium Bonds has to an interest rate. The odds of winning a prize from the April 2025 draw will remain at 22,000 to 1. There is expected to be over £411million in the prize fund with over 5.9 million prizes available, ranging from two £1million prizes to over 2.1 million £25 prizes.
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NS&I has also made changes to some of its savings products. The interest rate for its Direct ISA has increased from 3.00% AER to 3.50% AER. However, its Direct Saver is being reduced from 3.50% gross/AER to 3.30% gross/AER, and its Income Bonds is going down from 3.44% gross/3.49% AER to 3.26% gross/3.30% AER. Both changes will come into effect from March 5.
Andrew Westhead, NS&I Retail Director, said: “At a time when many savers are reviewing their ISA plans, I’m glad we have been able to increase our Direct ISA interest rate for those wanting to make the most of their tax-free savings allowance. We regularly review our products to ensure they reflect current market conditions.
“The changes we are making to Premium Bonds, Direct Saver and Income Bonds rates enable us to continue to balance the interests of savers, taxpayers and the stability of the broader financial services sector. Even with the change to the Premium Bonds prize fund rate, we are expecting more than 5.9 million tax-free prizes worth over £411 million to be won in the April 2025 draw.”
You can use the NS&I online prize checker tool, or the Premium Bonds prize checker app, to see if you’ve won. If you’re a winner, you can have the money paid into their bank account, or reinvest it into new Premium Bonds. You should be emailed or sent a text message from NS&I if you’ve won.
The odds of a bond winning each month are 21,000 to 1 for every £1 bond – but as we’ve mentioned above, most prizes are for smaller amounts. NS&I reduced its prize rate from 4.65% to 4.40% from its March 2024 draw. However, there will still be two jackpot prizes of £1million. The prize fund rate is often described as the the nearest thing Premium Bonds has to an interest rate.
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