Increase in Interest Rates for Two NS&I Savings Accounts - A Comparative Study
Top Savings Accounts Compared: NS&I's Withdrawn 6.2% Bond Outshines Current Market Offerings
In the world of savings accounts, the landscape has seen some significant changes. The best easy-access savings account currently on the market, offered by Chase Bank, pays 5% on balances up to £3,000,000. However, this includes a bonus rate of 2.17% for 12 months [1].
For those looking to grow their money for a longer period, Castle Community Bank leads the market in two-year fixed rate bonds, offering 4.38% on balances between £1,000 and £85,000 [1]. New issues of these bonds will be available from 24 July.
In contrast, NS&I's 1-year fixed-term British Savings Bonds recently offered a market-leading 6.2% interest rate when they launched but have now been withdrawn from sale as of July 2025 [2]. This rate was notably higher than the best available market fixed bond rates at the time.
As we compare the current market, the highest 1-year fixed-rate savings account is around 4.58%, offered by GB Bank with a £1,000 minimum deposit, followed closely by Tandem Bank at 4.52% AER with just £1 minimum deposit [1].
Regular savings accounts can offer higher rates, but they often come with restrictive terms and smaller maximum deposits [3].
It's important to note that NS&I withdrew their 6.2% one-year bond due to changing market conditions, so it is no longer available. The highest market fixed bond rates today are about 4.5-4.6%, still strong but significantly less than NS&I's previous offering.
Here's a summary of the comparison as of late July 2025:
| Product | Interest Rate (AER) | Notes | |-------------------------------------|---------------------|----------------------------------------| | NS&I 1-year fixed British Savings Bond | 6.2% (withdrawn) | Previously market-leading, now withdrawn[2] | | Best 1-year fixed savings account | ~4.58% | GB Bank, £1,000 min; Tandem ~4.52% £1 min[1] | | Best regular saver accounts | Up to 7.5% variable | Usually require monthly deposits, limited max amount, different terms[3] |
Andrew Westhead, NS&I Retail Director, stated that the new opportunity to save is good news for savers. The new interest rate for NS&I Guaranteed Growth Bonds is 4.18%, up from 4.05%, and for NS&I's 1-year-fixed-term British Savings Bonds, it's 4.18% [4]. The new bonds are available to new customers and those with existing NS&I one-year bonds that mature soon.
The top fixed term savings account on the market by AlRayan Bank offers an interest rate of up to 4.6% [5]. The new interest rate for NS&I Guaranteed Income Bonds, with an AER of 4.18%, is 4.11% [6].
[1] MoneySavingExpert.com (2025). Best easy-access savings accounts. [online] Available at: https://www.moneysavingexpert.com/savings/best-easy-access-savings-accounts/ [Accessed 15 July 2025].
[2] NS&I (2025). NS&I 1-year fixed-term British Savings Bond. [online] Available at: https://www.nsandi.com/products/savings-bonds/1-year-fixed-term-british-savings-bond [Accessed 15 July 2025].
[3] MoneySavingExpert.com (2025). Best regular savings accounts. [online] Available at: https://www.moneysavingexpert.com/savings/best-regular-savings-accounts/ [Accessed 15 July 2025].
[4] NS&I (2025). NS&I Guaranteed Growth Bonds. [online] Available at: https://www.nsandi.com/products/savings-bonds/guaranteed-growth-bonds [Accessed 15 July 2025].
[5] MoneySavingExpert.com (2025). Best fixed-term savings accounts. [online] Available at: https://www.moneysavingexpert.com/savings/best-fixed-term-savings-accounts/ [Accessed 15 July 2025].
[6] NS&I (2025). NS&I Guaranteed Income Bonds. [online] Available at: https://www.nsandi.com/products/savings-bonds/guaranteed-income-bonds [Accessed 15 July 2025].
- In the current personal finance climate, technology has provided platforms for comparison, such as MoneySavingExpert.com, which help individuals make informed decisions about their savings, investments, and bonds.
- As interest rates for savings accounts fluctuate, it's important to stay updated with the latest newsletter releases and market trends to maximize returns on personal-finance investments.
- Personal finance experts suggest considering various options, including regular savings accounts, fixed-term bonds, and guaranteed income bonds, to grow savings effectively.
- The recent withdrawal of NS&I's 6.2% one-year fixed-term British Savings Bonds has left a gap in the market, offering an opportunity for other financial institutions to introduce competitive interest rates to attract savers looking for favorable returns.
