Number of big money Premium Bond prizes set to fall from April draw

There will be fewer chances to win Premium Bond prizes from the April draw after savings giant NS&I announced changes.

The Premium Bonds prize fund rate will be reduced from 3.60% to 3.30% and the odds will be lengthened from 22,000 to one to 23,000 to one, NS&I said.

NS&I, which is backed by the Treasury, has a duty to balance the interests of its savers, taxpayers and the market and it is set targets for the amount of net finance it needs to raise each year for government.

Andrew Westhead, NS&I retail director, said: “This change to the Premium Bonds prize fund rate and odds reflects changes in the wider savings market, and ensures we continue to balance the interests of savers, taxpayers and the wider financial services sector.

“Premium Bonds continue to be the most popular UK savings account.

“Having recently passed £40 billion in prizes drawn, the April draw is expected to have close to six million tax-free prizes worth around £375 million.

“Launched 70 years ago in November 1956, Premium Bonds maintain their unique appeal by offering 100% security, the flexibility to withdraw easily and the excitement of potentially winning a tax-free prize each month.”

The Bank of England base rate was reduced in December, in a blow to savers, and further reductions are expected.

Instead of paying interest, Premium Bonds offer savers an annual prize fund rate that funds the monthly draw for tax-free prizes.

Each £1 bond purchased is entered into a monthly draw, where prizes range from £25 to £1 million.

The estimated number of £1 million prizes is set to remain unchanged in April, at two.

The estimated number of £100,000 prizes is expected to fall to 71 in April, from 78 in February.

NS&I also said the number of £50,000 prizes will fall from 154 in February to an estimated 143 in April.

There will be around 284 prizes worth £25,000 in April, down from 311 in February.

The estimated number of £10,000 prizes will fall from 777 to 712 over the same period.

The number of £25 prizes will go up, with around 2,806,003 predicted for April, compared with 2,643,007 in February.

The total number of prizes in April will be around 5,943,029, down from 6,183,066 in February.

People can hold up to £50,000 in Premium Bonds, including those aged under 16.

Nine out of 10 prizes are paid directly into the holder’s nominated bank account or automatically reinvested into Premium Bonds to go into the next draw, NS&I said.

New Premium Bond purchases need to be held for one full calendar month before being entered into the monthly prize draw.