NS&I boosts interest rate for 333,000 Direct ISA customers

More than 333,000 NS&I Direct ISA customers are set to benefit from today, with the interest rate NS&I pays on the account increasing from 2.15% tax-free/AER to 2.40% tax-free/AER.

The increase to the interest rate paid on NS&I’s Direct ISA follows upwards changes made to Premium Bonds, Income Bonds and Direct Saver earlier this year. In February this year, NS&I also brought one-year Guaranteed Growth Bonds and Guaranteed Income Bonds back on sale.

The change made to NS&I’s Direct ISA will ensure that the product is priced appropriately when compared to the rest of the ISA market. It will also help ensure that NS&I continues to balance the interests of savers, taxpayers and the broader financial services sector.

Variable rate savings products

Notes to Editors

1. NS&I is one of the largest savings organisations in the UK, offering a range of savings and investments to 25 million customers. All products offer 100% capital security as NS&I is backed by HM Treasury.
2. NS&I’s Direct ISA allows customers to invest from £1 and up to £20,000 in the 2023-24 tax-year. Customers can manage the account either online or by the phone. More information can be seen here.
3. NS&I announced on 14 February 2023 that the Premium Bonds prize fund rate would increase from 3.15% to 3.30%, effective from the March 2023 prize draw. The odds remained at 24,000 to 1. On this date, NS&I also announced changes to its Direct Saver and Income Bonds; these changes were effective immediately.
4. On 1 February 2023, NS&I brought Guaranteed Growth Bonds and Guaranteed Income Bonds back on sale. On 7 February 2023, NS&I launched a fourth Issue of its Green Savings Bonds account.
5. AER stands for Annual Equivalent Rate and enables the comparison of interest rates from different financial institutions and across different products on a like-for-like basis. It shows what the notional annual rate would be if interest was compounded each time it was credited or paid out. Where interest is credited once a year, the rate quoted and the AER will be the same.
6. Tax-free means the interest is exempt from UK Income Tax and Capital Gains Tax.
7. Information on NS&I’s on sale products can be found here.
8. Information on NS&I’s off sale products can be found here.