NS&I brings one-year fixed-rate bonds back on sale
Savings giant NS&I has put its one-year fixed-rate guaranteed growth and guaranteed income bonds back on general sale for the first time since 2019.
The new issues offer savers 4% annual equivalent rate (AER) interest for one-year fixed-rate guaranteed growth bonds and 3.97% AER for guaranteed income bonds.
Savers need to put in between £500 and £1 million and after a year have the choice of withdrawing their cash or reinvesting it.
Ian Ackerley, chief executive of NS&I, which is backed by the Treasury, said: “It’s continuing to be an exciting time for savers and I’m pleased that we are able to bring back on general sale our popular one-year fixed-rate bonds with two new issues.
“Existing customers may also gain from a better deal when their current bonds mature, with the option to renew with a higher interest rate.”
The savings giant said around 494,000 one, two, three or five-year guaranteed growth bonds, guaranteed income bonds or fixed interest savings certificate accounts may also benefit from new interest rates if savers choose to reinvest at maturity.
The two, three and five-year products are only available to existing customers with maturing products.
Savings rates have been increasing generally amid hikes to the Bank of England base rate, with the rate currently sitting at 3.5% and a further rise expected on Thursday.
Rachel Springall, a finance expert at Moneyfacts.co.uk said: “The one-year bonds could prove incredibly popular among savers as NS&I is a trusted brand.
“The savings market overall has been blessed by interest rate rises over the past year so there are currently a few alternative one-year fixed bonds that will pay 4% or more for savers to consider.
“NS&I do typically entice savers’ deposits to meet their net financing targets and adjust their positioning in response to market movements, so it is great to see such a competitive rate offered on these short-term fixed bonds.”