NS&I British Savings Bonds Relaunch – Rates, Terms and How to Buy

NS&I has brought back its 1-year and 5-year British Savings Bonds for the first time since 2010, marking a significant development for savers seeking fixed-rate returns. The April 2025 relaunch means all four term lengths are now available simultaneously, offering investors a choice between guaranteed growth or regular income payments.

The government-backed savings products now pay interest rates of between 4% and 4.1% depending on the term and product type selected. With minimum investments starting at just £500 and a maximum of £1 million per person, the bonds cater to a wide range of savers looking for security and predictable returns.

What are the interest rates and terms for the relaunched British Savings Bonds?

NS&I offers British Savings Bonds across four distinct term lengths, with each available in two different product variants. The Guaranteed Growth Bonds add interest to the bond value annually, while Guaranteed Income Bonds pay monthly interest directly to the account holder’s bank account.

• The 1-year Guaranteed Growth Bonds pay 4.07% gross/AER, while the income variant offers 4.00% gross and 4.07% AER
• Three-year Guaranteed Growth Bonds attract 4.02% gross/AER, with the income option at 3.95% gross and 4.02% AER
• All rates are fixed for the chosen term, providing certainty regardless of market changes
• Interest on Growth Bonds compounds annually within the bond, while Income Bonds deliver monthly payouts
• Earlier in 2025, rates were marginally lower, with 1-year Growth at 4.05% and 5-year Growth at 4.06%

How do I buy the new NS&I British Savings Bonds?

Purchasing British Savings Bonds requires going through NS&I directly, either online or via postal application. The bonds are available to both new customers opening an NS&I account and existing customers looking to invest additional funds or roll over maturing bonds.

Application process

The primary method for acquiring British Savings Bonds is through the official NS&I website, where current rates and product details are published. Customers can apply online using a debit card or bank transfer, with minimum investments starting at £500 per bond.

NS&I serves existing bondholders whose products are approaching maturity, offering them the opportunity to reinvest into new issues. The process maintains consistency whether customers are establishing new holdings or extending existing ones.

Eligibility requirements

The search results indicate that British Savings Bonds are available to UK residents, though specific eligibility criteria should be confirmed on the official NS&I website before applying. The investment limits apply per person per Issue, meaning individuals can hold multiple bonds across different terms within these boundaries.

Are NS&I British Savings Bonds safe and tax-free?

British Savings Bonds benefit from complete government backing, making them among the safest savings options available in the UK market. Your capital is protected through NS&I’s Treasury backing, which goes beyond standard Financial Services Compensation Scheme protection of £85,000 per person per institution.

Government security

NS&I operates as a statutory corporation backed by HM Treasury, meaning your savings carry a 100% guarantee from the government. This security appeals to risk-averse savers who want guaranteed returns without exposure to stock market volatility or potential bank failures. Further details on HM Treasury’s role in protecting savers are available on the government website.

Tax treatment

Interest payments on British Savings Bonds are made gross, meaning tax is not deducted at source. This contrasts with some savings products that pay interest net of basic rate tax. Higher-rate taxpayers will need to declare and pay tax on the interest earned through self-assessment.

Basic-rate taxpayers may benefit from the personal savings allowance, which allows up to £1,000 in savings interest to be earned tax-free annually. The actual tax liability depends on individual circumstances and total income from all sources.

When did NS&I relaunch British Savings Bonds and what changed?

NS&I reintroduced the 1-year and 5-year British Savings Bonds in April 2025, completing a product lineup that had been incomplete since February 2010. The three-year bonds had remained available throughout this period, but the shorter and longer terms had been absent from the range.

Early withdrawal restrictions

Fixed-term restrictions mean that funds cannot be accessed before the agreed maturity date. Savers must commit their capital for the full term selected, whether that is one, two, three, or five years. This contrasts with easy-access savings accounts that allow withdrawals without penalty. For a comprehensive overview of British Savings Bonds, consult our Hotel guide.

When the fixed term concludes, bondholders receive notification from NS&I and can choose to withdraw their funds or reinvest into a new term. This flexibility at maturity provides a natural exit point rather than locked-in commitment.

Impact on existing holders

The relaunch offers existing NS&I customers holding maturing bonds the chance to reinvest at potentially higher rates. NS&I had reduced rates in December 2024 before increasing them for the April 2025 relaunch, making the new terms attractive to customers previously locked into lower returns.

Current bondholders approaching maturity receive communication from NS&I explaining their options, including the opportunity to select different term lengths or product types based on their savings goals and income needs.

Timeline of the British Savings Bonds relaunch

The availability of British Savings Bonds has evolved significantly over recent years, with the April 2025 relaunch marking the culmination of a gradual restoration process.

1. February 2010: All four term lengths were last available simultaneously before certain terms were discontinued
2. December 2024: NS&I reduced rates, affecting the products available at that time
3. March 2025: Rate increases prepared for the upcoming relaunch, with 1-year Growth improving from 4.05%
4. April 2025: Official relaunch of 1-year and 5-year British Savings Bonds alongside existing 2 and 3-year options
5. Post-relaunch: Further rate adjustments resulted in 1-year Growth bonds reaching 4.07% AER

The simultaneous availability of all four terms represents the first complete product range in over fifteen years, giving savers comprehensive choice across different time horizons.

What is certain and what remains unclear?

Several aspects of British Savings Bonds are firmly established, while other details require clarification from official sources.

Prospective investors are advised to consult the official NS&I British Savings Bonds page for the most current information, as product terms and availability can change.

Context and market significance

The April 2025 relaunch arrives amid a broader environment of elevated interest rates, making fixed-term savings products attractive to investors seeking guaranteed returns without stock market exposure. British Savings Bonds position themselves within this landscape by offering government-backed security alongside competitive rates. For those monitoring the broader savings market, comparing offerings across different providers remains advisable.

Andrew Westhead, NS&I Retail Director, noted that the changes provide savers with greater choice while maintaining protection for their capital. The rate adjustments were designed to help NS&I meet its Net Financing target for 2025-26 while balancing the interests of savers, taxpayers, and the broader financial services sector.

The products serve distinct purposes: Guaranteed Growth Bonds suit those wanting their investment to increase in value over time, while Guaranteed Income Bonds appeal to retirees or others requiring regular cash flow from their savings. This flexibility helps British Savings Bonds cater to different investor profiles within a single product family.

“The changes offer savers greater choice with guaranteed rates while their savings remain protected.”

— Andrew Westhead, NS&I Retail Director

For those considering how British Savings Bonds fit within their overall savings strategy, it is worth comparing against cash ISA options given recent allowance changes, as well as exploring alternative fixed-rate products that may offer different features or tax treatment.

Key facts at a glance

British Savings Bonds are government-backed fixed-term savings products offered by NS&I, designed for savers seeking guaranteed returns over a set period. The April 2025 relaunch restored the full range of term options, with rates between 4% and 4.1% depending on the product and term selected.

Investors commit funds for one to five years with no early withdrawal allowed, receiving either annual interest additions or monthly income payments depending on the chosen variant. The products suit those prioritizing security and predictability over flexible access.

Frequently asked questions