The new 3-year fixed-rate British Savings Bonds – announced by the Chancellor in his Spring Budget – have gone on sale from today offering interest of 4.15% gross/AER.
The bonds are designed to help boost investment in the UK and increase government revenue from its provider NS&I.
The British Savings Bonds are new three-year, fixed-rate issues of NS&I’s Guaranteed Growth Bonds and Guaranteed Income Bonds. They offer savers a guaranteed interest rate fixed over three years for investments between £500 and £1 million.
The Guaranteed Growth Bond option is available at 4.15% gross/AER and the Guaranteed Income Bond is 4.07% gross/4.15% AER.
The government’s savings provider NS&I is handling the launch and says the intention is for the new British Savings Bonds to be available for an “extended period of time.” They can be purchased online at nsandi.com.
Like other savings products from NS&I the money is 100% guaranteed by backed by the Treasury and will be invested back into supporting the UK through government financing although it is not clear what specific areas will be funded first.
Economic Secretary to the Treasury Bim Afolami said: “The bonds will help to grow the savings culture in the UK while providing cost-effective financing for the government.”
NS&I chief executive Dax Harkins said: “British Savings Bonds are there to help people save for the longer term and support their savings goals, safe in the knowledge that their investments are 100% protected. As with all savings with NS&I, money is invested back into supporting the UK through government financing.”
Interest rates for off-sale Guaranteed Growth Bonds and Guaranteed Income Bonds are also increasing for customers with maturing bonds. Information is available here.
In the Spring Budget it was announced that NS&I’s Net Financing target for 2024-25 has increased to £9 billion (in a range of +/- £4 billion either side of this target).
NS&I has more than 24 million customers.
