Premium Bonds holders are set to benefit from improved odds of winning prizes from the July draw, as provider NS&I announced changes that will also see some savings rates increase. The odds will shorten to 22,000 to one, down from 23,000 to one, for each £1 Premium Bond held. This adjustment, backed by the Treasury, is expected to result in approximately 322,000 additional prizes in the July draw compared to the May 2026 draw, with the total prize pot increasing by more than £60 million.
More Prizes and Higher Savings Rates
In July, there will be an estimated 12 extra £100,000 prizes, 24 more £50,000 prizes, and an additional 49 £25,000 prizes. The number of £1 million prizes will remain at two. Alongside these changes, NS&I has increased variable interest rates on several savings products from Thursday. The Direct Saver account now offers 3.45% AER, Income Bonds also pay 3.45% AER, Direct Isas provide 3.80% AER, and Junior Isas offer 3.70% AER.
Expert Reactions
Rachel Springall, a finance expert at Moneyfactscompare.co.uk, commented: “Savers who prefer to keep their pots with NS&I will be delighted to see rates increase, but it is worth noting that the top rates on the market are over 4% on easy access accounts, with some top fixed accounts paying well over 4.50%.” She added that this move comes amid expectations that interest rates may stay higher for longer. Springall advised savers to “check the latest deals on the market and review any old pots.” Regarding Premium Bonds, she noted that winning is “all about luck” and that they do not pay regular income, making a savings account a potentially better choice for those seeking regular returns.
Sarah Coles, head of personal finance at AJ Bell, highlighted the broader economic context: “What happens next for Premium Bonds will depend on the wider world. War in Iran and the resulting rise in the oil price means we could see more inflation. This could keep interest rates higher for longer, which in turn would keep easy access rates higher. At the moment, the market is pricing in two more rate rises during the rest of 2026 – and possibly even a third. Each rise is likely to push the easy access market higher – including Premium Bonds. It means this might not be the end of the prize rate hikes.”
Coles also commented on the Junior Isa rate: “The cash Junior Isa rate is now pretty competitive. If you’re opening one for an older teenager who needs the money at 18, this could be a decent option. However, for younger children, with a longer time-horizon, investment often makes far more sense.”
