NS&I hacks down savings rates

New NS&I savings certificates may prompt consumers to invest

Consumers could be encouraged to invest as NS&I has unveiled new Issues for savings over a five-year period.
Post Office to stop serving some National Savings customers

The National Savings & Investments (NS&I) has announced that Investment and Easy Access account holders will have to deal with NS&I directly rather than through the Post Office.

Thursday, 20 November 2008 12:00

National Savings and Investments (NS&I) has slashed interest rates on variable savings products by up to 1.5 per cent per annum.

The cuts, which will affect variable-rate ISAs, income bonds and easy access savings accounts, come after the Bank of England reduced the base rate to 1.5 per cent earlier this month.

It means the Cash ISA is now paying a rate of 2.4 per cent and Income Bonds, which reduced by 1.3 per cent, now have interest rates of anywhere between 2.7 per cent and 2.45 per cent, depending on the amount invested.

Meanwhile, the Investment Accounts and Easy Access Savings accounts are now paying interest of between 2.2 per cent and one per cent.

The Premium Bonds prize fund rate is also being reduced on December 1st by 1.05 per cent to 1.8 per cent.

NS&I said it would continue to pay out two £1million jackpot prizes every month, plus other tax-free prizes.