NS&I Announces Premium Bonds Prize Fund Cut and Lengthened Odds
London, 24 February 2026 – National Savings and Investments (NS&I) has confirmed a significant reduction to the Premium Bonds prize fund rate, marking a “double hit” for millions of savers across the United Kingdom. Starting from the April 2026 draw, the prize fund rate will be slashed from 3.6% to 3.3%, while the odds of any individual £1 bond winning a prize will become notably longer.
Major Changes to Prize Structure
The Treasury-backed bank announced that the total number of monthly prizes is expected to fall by approximately 240,037, dropping from 6.18 million to roughly 5.94 million in April. This reduction will primarily impact the higher and medium value prize bands, with the number of £100,000, £50,000, and £25,000 prizes set to decrease. This move follows a trend of declining returns as NS&I adjusts its rates to align with the broader savings market.
Key Facts: April 2026 Changes
The following table outlines the specific adjustments to the Premium Bonds scheme effective from the April 2026 prize draw.
| Category | Current (February 2026) | New (From April 2026) |
|---|---|---|
| Prize Fund Rate | 3.60% | 3.30% |
| Odds of Winning (per £1 bond) | 22,000 to 1 | 23,000 to 1 |
| Estimated Monthly Prizes | 6,183,066 | 5,943,029 |
| Minimum Investment | £25 | £25 |
| Maximum Holding | £50,000 | £50,000 |
Impact on Savers
Financial analysts suggest that the 3.3% rate now lags significantly behind the best easy-access savings accounts, which currently offer rates upwards of 4.5%. While Premium Bond prizes remain tax-free, the lengthening of the odds to 23,000 to 1 means that savers with smaller holdings are even less likely to see a regular return on their capital. For those with the maximum £50,000 investment, the expected number of annual prizes will decrease as the prize pool shrinks.
Frequently Asked Questions
When do these changes take effect?
The new prize fund rate of 3.3% and the lengthened odds of 23,000 to 1 will apply to the April 2026 draw and all subsequent draws until further notice.
Are Premium Bonds still tax-free?
Yes, all prizes won through Premium Bonds are 100% free from UK Income Tax and Capital Gains Tax.
Is my capital safe with NS&I?
Yes. As NS&I is backed by HM Treasury, 100% of the capital you invest in Premium Bonds is guaranteed to be safe, regardless of the prize fund rate changes.
How is the prize fund distributed?
NS&I divides the prize fund into three bands: Higher (including the £1 million jackpots), Medium (£500 to £1,000), and Lower (£25 to £100). The percentage share allocated to each band is adjusted monthly to reflect the total prize fund rate.