The number of Premium Bonds prizes worth £50 to £100,000 will increase from next month’s draw, according to savings provider NS&I.
The prize fund percentage of Premium Bonds will be increased from 3.00% to 3.15%, effective from the February 2023 prize draw.
This follows the rate increase from 2.20% to 3.00% on January 1, 2023.
For example, the changes mean there are an estimated 59 £100,000 prizes to be won in February, up from 56 in January.
There will also be an estimated 117 £50,000 prizes next month, up from 111 this month.
In a rapidly changing savings market, we do everything we can to ensure that our products remain competitive
And next month there are about 12,573 £1,000 prizes, up from 11,968 in January.
The premium rate change on Premium Bonds is the fourth upward change NS&I has made in the past year, meaning the prize money percentage is at its highest level in over 14 years.
The overall probability of each £1 bond winning a prize remains unchanged at 24,000 to one, with an estimated 2,376,161 smaller £25 prizes available in February, up from 2,617,902 in January.
The estimated number of £1 million prizes remains unchanged at two.
Treasury-backed provider NS&I also said the interest rate paid on its Direct Saver and Income Bonds has risen from 2.30% to 2.60%, while the interest rate on Direct Isa has risen from 1.75% to 2.60% as of Tuesday. 2.15%.
NS&I also increased the interest rate it pays on its Junior Isa from 2.70% to 3.40% from Tuesday.
Due to the changes, Income Bonds now pay the highest interest since 2008, while the interest on the Direct Isa is the highest since 2013.
The interest paid on NS&I’s Direct Saver is the highest since the account was launched in March 2010.
The changes ensure that NS&I’s savings products are competitive with respect to the broader savings market, the provider said.
NS&I has a duty to balance the interests of savers, taxpayers and the wider financial sector.
NS&I CEO Ian Ackerley said: “Today’s changes will provide a welcome boost to savers of all ages across the country, with more Premium Bond prices and some of the highest interest rates we’ve seen in over a decade.
“In a rapidly changing savings market, we do everything we can to ensure that our products remain competitive and that our customers receive a good return on their savings. Today’s changes ensure we continue to balance the needs of savers, taxpayers and the wider financial services industry.”
This is a smart response to inflation
Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, said of the changes in Premium Bonds: “The higher price percentage is accompanied by a rebalancing of prices.
“In fact, the number of £25 prizes will be down just over 9% to 2.376 million, while the number of £50 and £100 prizes are up just over 10% to 1.28 million.
“The number of prizes at every level between £500 and £100,000 is also up about 5%.
“This is a smart response to inflation. With rapid price increases on all sides, £25 is unlikely to feel as rewarding as it did a year ago. Adding so many more £50 and £100 prizes means more people are winning amounts that feel they will make a difference.
“Increasing the bigger prizes, meanwhile, builds on January’s move to introduce more life-changing sums of money.
“Right now, with money so tight for so many, the idea of winning a prize that will make a huge difference in people’s lives is incredibly appealing.”