The number of prizes in the UK's Premium Bonds scheme is set to rise significantly, as National Savings & Investments (NS&I) attempts to lure cash from retail savers.
The state-backed savings arm is increasing the monthly prize pool to boost the odds of winning, a move designed to make the tax-free lottery-style product more competitive against other savings options.
With inflation eroding the real value of cash holdings, the government-backed institution is using the allure of higher win probabilities to retain its base of 23 million savers.
This adjustment comes as NS&I faces pressure to attract new deposits.
With inflation eroding the real value of cash holdings, the government-backed institution is using the allure of higher win probabilities to retain its base of 23 million savers.
The strategy highlights the challenge for traditional savings products in an environment where guaranteed interest rates often lag behind price growth.
The increased prize pool offers a tangible benefit for holders, who stand to win tax-free cash prizes without risking their capital.