When will NS&I raise savings rates?

NS&I is under fire for failing to do enough to help struggling savers.

The Treasury-backed bank hasn’t raised its interest rates for nearly six months for some savers — despite the Bank of England increasing base rate four times since December.

Premium Bond prizes have been frozen at 1 pc since December 2020, even though base rate has risen tenfold in that time. And its new green three-year bond pays 1.3 pc less than savers can earn elsewhere with just a one-year deal.

National Savings & Investments announced a series of rate rises in December after base rate increased to 0.25 pc. But some savers have seen no benefit from the following three rises, which pushed base rate up a further 0.75 points to 1 pc.

Its Direct Isa pays just 0.35 pc compared with a top rate of 1pc from Marcus by Goldman Sachs. NS&I’s easy-access Direct Saver pays 0.5 pc, while Atom Bank pays more than double this at 1.25 pc. Income Bonds, held by many pensioners, are also stuck at 0.5pc. Premium bonds are by far the most popular account with NS&I. Savers hold £117.8billion in these, hoping to win a monthly taxfree prize of up to £1 million.

NS&I cut the amount it pays in monthly prizes from 1.4pc to 1pc in December 2020. The odds of winning a monthly prize tumbled by nearly 30 pc from 24,500 to 34,500 to one.

Children with NS&I’s Junior Isa have also been short-changed as their rate has not risen from 1.5pc since November 2020.

Ian Ackerley, chief executive at NS&I, told Money Mail: ‘NS&I reviews rates on all its products regularly and recommends changes to HM Treasury when we believe they are appropriate.’

Anna Bowes, director at website Savings Champion, says: ‘NS&I rates are lagging well behind its rivals. This popular provider should increase rates to help its loyal savers.’