Ns&i bond rate increases

On May 1, 2026, NS&I announced rate hikes across its guaranteed growth bonds and guaranteed income bonds, providing a much-needed boost for UK savers amidst a challenging economic landscape.

The one-year British savings bond rate increased from 4.07% to 4.5% AER, while the two-year bond rate rose from 3.98% to 4.48% AER. The three-year bond rate also saw an increase from 4.02% to 4.45% AER, and the five-year bond rate went from 4.05% to 4.4% AER. These changes reflect NS&I’s strategy to attract more deposits as inflation continues to challenge the financial stability of many households.

Key statistics:

• The one-year bond rate is now at 4.5% AER.
• The two-year bond rate is now at 4.48% AER.
• The three-year bond rate is now at 4.45% AER.
• The five-year bond rate is now at 4.4% AER.

Anna Bowes commented on the significance of these changes: “This choice can be important, particularly for those who pay tax on their savings.” Many savers are exploring options that can provide better returns in light of rising living costs and stagnant wages.

Meanwhile, NS&I remains a popular choice among individuals across the UK, competing effectively with traditional banks in the savings market. Dan Coatsworth noted, “NS&I effectively competes with the banks as a savings brand and is extremely popular with individuals up and down the country.” This popularity stems from the security it offers as a government-backed entity.

In addition to the bond rates, NS&I’s Premium Bonds continue to attract attention. The maximum holding for Premium Bonds is £50,000, and currently, the prize fund rate stands at 3.3%. However, the odds of securing a prize remain steep at 23,000 to one for each £1 Bond—an aspect that some savers weigh heavily when considering their options.

As NS&I adjusts its rates routinely to meet its net financing target set by the government, these recent hikes signify an important moment for both savers and the broader financial services landscape in the UK. With inflation still a pressing concern for many households, these new rates present an opportunity for those looking to secure their savings more effectively.