NS&I Green Savings Bonds: it’s hard to put your money where your mouth is when they’re still tight-lipped on the rate
- NS&I will launch Green Savings Bonds this year.
- The bonds will run for a three-year term, and the money will be ploughed into green projects approved by the government.
- Savers will be able to put in between £100 and £100,000 per person.
NS&I has announced more details on the Green Savings Bonds.
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The N&I Green Savings Bonds
Sarah Coles, personal finance analyst, Hargreaves Lansdown:
“The N&I Green Savings Bonds will let savers put their money where their mouth is, and support sustainable projects with their savings. But while it’s a useful addition to the growing world of green savings, there are already accounts with similar aims on offer. What really matters here is the rate, and NS&I is remaining tight-lipped on that front.
So far, all we know is that the bond will support projects that aim to tackle climate change and make the environment greener and more sustainable - like green transport, renewable energy, and energy efficiency. This isn’t enormously far from the aims of existing ethical savings accounts from the likes of Triodos Bank.
In practical terms, the money will be passed to the Treasury and held in a general account. It will then release funds equivalent to the amount raised from the bonds to green projects within two years. It will report on how the money is spent, and the environmental benefits achieved.
The fact this account will be on offer from a national treasure like NS&I will appeal, as will the fact the money is 100% guaranteed, up to the maximum investment of £100,000. However, this isn’t enough to drive a blockbuster savings product: the rate needs to be competitive to draw significant savings.
The timing may well be wrong for revealing the rate right now. Over the past few weeks, smaller banks have been competing hard at the top of the fixed rate savings tables, pushing the most competitive rates up. This is likely to die back as these banks fill their coffers, so NS&I may want to announce the rate at a time when it compares favourably to the best on the market.”
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