The prize fund rate for Premium Bonds will be cut from 3.60% to 3.30% for the April 2026 draw, with odds of winning getting longer at 23,000 to 1.

This will be disappointing news for the 24 million plus Premium Bond holders but the move isn’t surprising following the recent base rate cuts and is in line with the general downwards movement of interest rates in the UK savings market.

Since November 1956, Premium Bonds have offered savers an accessible way to save, with the chance to win tax-free prizes. Instead of paying interest, there’s an annual prize fund rate that funds the monthly draw for tax-free prizes. Each £1 Bond purchased is entered into a monthly prize draw, where prizes range from £25 to £1 million, making it an engaging way to save.

Individuals can hold up to £50,000 in Premium Bonds, including those aged under 16. Nine out of ten prizes are paid directly into the holder’s nominated bank account or automatically reinvested into Premium Bonds to go into the next draw. New Premium Bonds purchases need to be held for one full calendar month before being entered into the monthly prize draw.

Number and value of Premium Bonds prizes