What Happened
National Savings & Investments (NS&I) has announced significant changes to its Premium Bonds program, effective from the April 2026 draw. The odds of winning a cash prize will increase from 22,000 to one to 23,000 to one. Additionally, the prize fund rate will be reduced from 3.60% to 3.30%, meaning that for every £10,000 invested, bondholders can expect an average payout of £330, down from £360.
Why It Matters
This reduction in the prize fund rate and the increased odds against winning are likely to leave millions of Premium Bondholders feeling disheartened. Despite these changes, NS&I has assured that approximately six million tax-free prizes, totaling around £375 million, will still be available in the April draw. The adjustments reflect broader trends in the savings market, according to NS&I Retail Director Andrew Westhead, who emphasized the need to balance the interests of savers, taxpayers, and the financial services sector.
What’s Next
As the changes take effect, bondholders will need to adjust their expectations regarding potential returns from their Premium Bonds. The total number of prizes is expected to decrease from February’s total of 6,183,066 to an estimated 5,943,029 in April. However, the number of £25 prizes will see an increase, while the number of £1 million prizes will remain unchanged at two per month. This marks the sixth reduction in the prize fund rate since September 2022.
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