New fixed rate direct 2-year Bonds from NS&I

NS&I is to launch a new 2-year issue of both its Guaranteed Growth Bonds and Guaranteed Income Bonds - which will go on sale on 13 July 2009. The new 2-year Bonds will only be available direct (via phone or online) from NS&I, and will pay an interest rate of 3.75% per annum and 3.65% respectively.

Customers can invest between £500 and £1 million in total in the fixed rate bonds, with guaranteed rates of interest. The Guaranteed Income Bond offers customers the opportunity to receive their interest as a monthly income, while with the Guaranteed Growth Bond customers will receive their interest at the end of the 2-year term.

The Bonds come with the 100% capital guarantee which NS&I can offer because all of its savings and investments are backed by HM Treasury.

The new Bonds, which are available online and through NS&I's award winning UK based call centres, are part of NS&I's strategy to encourage customers to buy and manage their savings with NS&I directly. This enables NS&I to offer a more attractive interest rate to customers.

Peter Cornish, Director of Customer Offer at NS&I, said: "Our Guaranteed Income Bonds and Guaranteed Growth Bonds offer customers a simple and straightforward saving opportunity.

"Money saved in our Guaranteed Income Bonds or our Guaranteed Growth Bonds will earn a competitive and guaranteed rate of interest for the next two years. It is a simple offer, and easy to take up - either online at nsandi.com or through our UK based call centres."

Dr Robin Keyte, Chartered Financial Planner and Director of Towers of Taunton Ltd, which specialises in fee-based financial planning and socially responsible investments, commented on the new issues: "NS&I's Guaranteed Growth Bonds and Guaranteed Income Bonds are an effective way to earn a fixed rate of interest on your investment, either as monthly income or as a lump sum at the end of the term. Like all NS&I investments, they also have the added benefit of a 100% capital guarantee, which is something many people will value highly in the current environment."