NS&I has announced today that it will be increasing the interest rates on its Direct ISA, Direct Saver and Income Bonds to 0.35% on 29 December 2021 following last week’s Bank of England base rate rise.
The interest rate on Direct Saver and Income Bonds will be increased by 20 basis points, from 0.15% gross/AER to 0.35% gross/AER. The interest rate on Direct ISA will be increased by 25 basis points, from 0.10% tax-free/AER to 0.35% tax-free/AER.
NS&I’s Net Financing target for 2021-22 is £6 billion, in a range of £3 billion to £9 billion. In October this year, NS&I published its year-to-date total Net Financing performance of £0.6 billion. The decision to increase the interest rates on these products is in order to help NS&I meet its annual Net Financing target.
| Product | Current interest rate | Interest rate from 29 December 2021 (change in brackets)
|
| Direct ISA | 0.10% tax-free/AER | 0.35% tax-free/AER (+25 basis points) |
| Direct Saver | 0.15% gross/AER
|
0.35% gross/AER (+20 basis points) |
| Income Bonds | 0.15% gross/AER
|
0.35% gross/AER (+20 basis points) |
