NS&I (National Savings & Investments) has announced significant cuts to interest rates on several accounts, effective from 24 November, affecting millions of savers. The rate on income bonds will drop from 1.15% to 0.01%, meaning a £1,000 deposit would earn just 10p gross interest after a year. Premium bonds prize fund rate is also being reduced, impacting around 24 million people.
The cuts have been criticised as shutting the door on UK savers, with many accounts previously offering market-leading returns now paying as little as 0.01%. However, some alternatives are available. Coventry Building Society launched Double Access Saver (Online) (2) paying 1.1% variable interest, though it limits withdrawals to two per year without penalty. Yorkshire Building Society's Internet Saver Plus Issue 7 offers tiered rates up to 1% for balances of £50,000 or more, with unlimited withdrawals.
For those seeking easy access, digital bank Atom has introduced Instant Saver paying 0.75% variable with no restrictions. Monthly income options include Aldermore Bank's One-Year Fixed-Rate Savings Account at 1.25% monthly interest. Cash ISA holders can consider Skipton Building Society's Cash eISA Saver Issue 6 at 1% or Coventry's Triple Access ISA at 0.96%, both accepting transfers in.
