NS&I Cuts Rates on British Savings Bonds – Are They Still Worth It?

National Savings & Investments (NS&I) has launched new British Savings Bonds, but with significantly lower rates than previous offers. Here’s what savers need to know.

2024 British Savings Bonds Rates (vs Previous Rates)
Term New Rate (AER) Previous Rate (AER) Drop
2-Year 3.85% 4.00% -0.15%
3-Year 3.88% 4.10% -0.22%
5-Year 3.84% 4.06% -0.22%
Minimum deposit: £500
Type: Government-backed fixed-rate bonds

Why Have Rates Fallen?
🔹 Andrew Westhead (NS&I Retail Director):
“Changes reflect current market conditions and ensure balance between savers, taxpayers, and financial services.”

🔹 Rachel Springall (Moneyfacts):
“NS&I adjusts rates to stay competitive. Savers should compare options regularly.”

The cuts follow the Bank of England’s base rate reduction and similar moves by high-street banks.

How Do They Compare to the Best Fixed-Rate Bonds?
Provider Term Rate (AER) £10K Interest (vs NS&I)
Cynergy Bank 2-Year 4.43% +£116 more
GB Bank 3-Year 4.42% +£162 more
Birmingham Bank 5-Year 4.47% +£315 more
💡 Key Takeaway:
While NS&I offers 100% security, competitors pay 0.5%-0.6% more—worth £100s extra on £10K deposits.

Who Should Consider NS&I Bonds?
✔ Risk-averse savers (government-backed security)
✔ Large deposits (no upper limit)
✔ Those prioritizing stability over top returns

❌ Not ideal for maximizing interest (better rates elsewhere)

Junior ISA Rate Also Falling
NS&I is also cutting its Junior ISA rate (exact details TBC), following the savings market trend.