NS&I British Savings Bonds: Fixed Rates Now Up to 4.75%

What NS&I has changed

NS&I, the government-backed savings provider, has increased the interest rates on its fixed-term British Savings Bonds, launching new issues on 31 July 2026. It is the third time in 2026 that NS&I has raised these rates, a notable move at a point when many banks and building societies have been trimming savings returns following reductions in the Bank of England base rate. British Savings Bonds come in two forms: Guaranteed Growth Bonds, which add interest each year and pay it all at the end of the term, and Guaranteed Income Bonds, which pay interest monthly. Both are available over one, two, three and five-year terms, and the rates rose across the range. The headline figure is 4.75 percent AER on the new five-year Guaranteed Growth Bond, with the one-year Guaranteed Growth Bond paying 4.72 percent AER. Savers can deposit between £500 and £1 million, and the money is locked away for the full term. Because NS&I is backed by HM Treasury, the bonds carry a level of security that sets them apart from ordinary bank accounts, which matters most for savers holding very large balances.

The new rates in detail

The table below sets out the headline rates on the new issues of NS&I's Guaranteed Growth Bonds, the version that rolls interest up and pays it at maturity. The two and three-year issues also increased, sitting between the one-year and five-year figures, while Guaranteed Income Bonds, which pay monthly, offer a marginally lower annual equivalent rate in exchange for regular income. All rates are fixed for the full term, so they will not change even if the Bank of England alters its base rate during that period. This is one of the central attractions of a fixed-term bond: certainty about the return from the day the money goes in. The trade-off is access, because the funds cannot normally be withdrawn until the term ends. Savers weighing a bond therefore need to be confident they will not need the money in the meantime, since breaking a fixed term early is either not permitted or carries a penalty. For those who value a guaranteed outcome over flexibility, the new rates make the bonds more competitive than they have been for much of the year.

How this compares with the wider market

NS&I's decision to raise rates runs against the recent direction of the wider savings market. After the Bank of England reduced its base rate earlier in the year, many providers cut the returns on both easy-access and fixed accounts. NS&I moving the other way reflects its need to meet a net financing target set by the Treasury for the 2026 to 2027 financial year, essentially a goal for how much money it must raise from savers. When NS&I needs to attract more deposits, it tends to lift rates; when it has taken in enough, it pulls them back, which is why its pricing can move independently of the base rate. The current fixed rates sit above the average for comparable fixed-term accounts, though savers willing to shop around can still find higher headline rates from some smaller banks. What NS&I offers in place of the very top rate is the Treasury guarantee, which becomes especially relevant for anyone saving more than the £85,000 limit protected elsewhere. For many savers the choice comes down to a small difference in rate against the reassurance of unlimited protection.

The Treasury guarantee explained

The main structural difference between NS&I and a high-street bank is the protection behind the money. Deposits with UK-regulated banks and building societies are covered by the Financial Services Compensation Scheme up to £85,000 per person per banking institution. Anything above that limit is not protected if the institution fails. NS&I is different: because it is backed directly by HM Treasury, every penny held with it is secure, with no upper limit. For most savers this makes little practical difference, since balances sit below the compensation threshold. For those with substantial sums, however, the guarantee allows them to keep a large amount in one place without splitting it across several institutions to stay within the protected limit. This is why NS&I products are often considered by savers with large cash holdings, even when the headline rate is not the highest available. The security is the point, and it is the feature NS&I leans on when its rates are competitive rather than market-leading. It also explains why NS&I is frequently used for money that a saver cannot afford to put at any risk.

How Premium Bonds fit in

NS&I is best known for Premium Bonds, and these have moved differently from the fixed-rate bonds. Rather than paying interest, Premium Bonds enter savers into a monthly prize draw, with the size of the prize pot set by a prize fund rate. That rate stands at 3.80 percent for the July 2026 draw, with the odds of any single £1 bond winning a prize at 22,000 to one. Premium Bonds appeal to savers who value the chance of a tax-free windfall and who are comfortable that, on average, returns may be lower than a guaranteed account, particularly for those holding smaller amounts. The contrast with the fixed-rate bonds is instructive: the British Savings Bonds offer a certain, guaranteed return locked in for a set term, while Premium Bonds offer a variable, luck-based outcome with instant access to the money. Both sit under the same Treasury-backed umbrella, so the choice between them turns on whether a saver prefers certainty or the possibility of a prize. Savers can also hold both, using fixed bonds for a guaranteed core and Premium Bonds for the chance of a win.

What savers should keep in mind

Fixing money into a bond means giving up access for the term, so the decision rests on whether the funds are likely to be needed sooner. Interest earned outside an ISA counts towards the Personal Savings Allowance, which lets basic-rate taxpayers earn £1,000 of savings interest tax-free each year and higher-rate taxpayers £500, with any excess taxed at the saver's marginal rate. As rates have risen, more savers have found their interest exceeding these allowances, which has increased interest in ISAs, where returns are tax-free regardless of amount. NS&I also offers a Direct ISA and a Junior ISA for those who want to shelter savings from tax. The rates on all NS&I products are kept under review and can change at any time, so the figures quoted here apply to the issues on sale at the time of writing. Anyone considering a fixed bond can check the current rates and terms on the NS&I website before committing, and should weigh the guaranteed return and Treasury protection against the higher headline rates sometimes available elsewhere without that unlimited cover.

Frequently asked questions

What is the top NS&I fixed savings rate now?

The highest rate on the new British Savings Bonds is 4.75 percent AER, paid on the five-year Guaranteed Growth Bond launched on 31 July 2026. The one-year Guaranteed Growth Bond pays 4.72 percent AER.

Is money held with NS&I safe?

Yes. NS&I is backed by HM Treasury, so all deposits are fully secure with no upper limit, unlike bank accounts, which are protected by the Financial Services Compensation Scheme only up to £85,000 per institution.

What are British Savings Bonds?

British Savings Bonds are NS&I's fixed-term products. They come as Guaranteed Growth Bonds, which pay interest at the end of the term, and Guaranteed Income Bonds, which pay monthly, over one, two, three and five-year terms.

Can you withdraw from a fixed NS&I bond early?

No. British Savings Bonds lock the money away for the full term, so funds cannot normally be accessed until the bond matures. Savers who may need access sooner would look at easy-access accounts instead.

How do NS&I rates compare with banks?

The new fixed rates are above the average for comparable accounts, though some smaller banks offer higher headline rates. NS&I's distinctive feature is the Treasury guarantee, which protects unlimited balances.