NS&I relaunches one year bond at its highest rate in over a decade

The one-year fixed rate Guaranteed Growth Bonds and Guaranteed Income Bonds are on offer for the first time since 2019.

The Government-backed National Savings and Investments (NS&I) relaunched its one-year fixed rate Guaranteed Growth Bonds and Guaranteed Income Bonds today.

The Guaranteed Growth Bonds Issue 70 now pays a rate of 4.00% AER on anniversary while the Guaranteed Income Bonds Issue 70 pays 3.97% AER monthly. This means both rates are the provider’s highest on offer since 2010.

“I’m pleased that we are able to bring back on general sale our popular one-year fixed-rate Bonds with two new Issues,” said Ian Ackerley, Chief Executive at the NS&I.

This is the first time one-year fixed rate Guaranteed Growth Bonds and Guaranteed Income Bonds have been on sale to the public since 2019, the year before the COVID-19 pandemic and the ensuing lockdowns.

“The savings market overall has been blessed by interest rate rises over the past year so there are currently a few alternative one-year fixed bonds that will pay 4% or more for savers to consider,” said Rachel Springall, Finance Expert at Moneyfacts.

SmartSave offers the market-leading one-year fixed rate of 4.16% AER on maturity. Like NS&I’s options, this offer can only be opened and managed online.

However, it is likely that SmartSave will attract wealthier savers as its minimum opening deposit sits at £10,000. NS&I’s options set this at £500.

Still, based on a deposit of £10,000, savers who opt for SmartSave’s 1 Year Fixed Rate Saver can expect to earn £416 over the one year period. In contrast, the same deposit in the Guaranteed Growth Bonds Issue 70 would earn £16 less over this period.

Meanwhile, the top rate for monthly interest payments on this chart comes from Atom Bank. At 4.15% AER, the 1 Year Fixed Saver requires a minimum deposit of £50.

It is also only opened and managed via Atom Bank’s mobile app.