NS&I Interest Rate Cuts – Providing A Solution To Your Clients

10,000 clients hold more than £1m with NS&I, 67,000 hold more than £250,000 and over a million are holding £50,000 or more[1], but in light of NS&I's swingeing rate reductions, these affluent clients will no doubt now be looking for an alternative solution that offers them not only better returns, but also comparable levels of protection.

From 24 November, National Savings & Investments (NS&I) interest rates will be significantly reduced, with NS&I’s Income Bond and Investment Account rates being cut to just 0.01%.

NS&I confirmed that £19.9 billion had been deposited in their accounts between April and June, and that demand had remained ‘at similarly high levels between July and September', suggesting that the Treasury’s financing target of £35bn has been met.

NS&I's chief executive Ian Ackerley said, "It is important that we strike a balance between the interests of savers, taxpayers and the broader financial services sector; and it is time for NS&I to return to a more normal competitive position for our products."


NS&I Product


Current NS&I
(Gross) rate


NS&I (Gross) rate
from 24 November


Income Bond



Direct Saver



Investment Account



Guaranteed Growth Bond (1 Year)



Guaranteed Growth Bond (2 Year)



Guaranteed Growth Bond (3 Year)



Guaranteed Growth Bond (5 Year)



Guaranteed Income Bond (1 Year)



Guaranteed Income Bond (2 Year)



Guaranteed Income Bond (3 Year)



Guaranteed Income Bond (5 Year)



Fixed Interest Savings Certificate (2 Year)



Fixed Interest Savings Certificate (5 Year)



Source: Moneyfacts


There are 10,000 clients holding more than £1m with NS&I, 67,000 holding more than £250,000 and over a million holding £50,000 or more[1], but in light of such swingeing rate reductions, these affluent clients will no doubt now be looking for an alternative solution that offers them not only better returns, but also comparable levels of protection.


Maximise interest. Minimise Risk.  

Flagstone offers exactly that solution, enabling clients to maximise the interest they’re earning on their cash and importantly empowering them to reduce their risk exposure through optimal Financial Services Compensation Scheme (FSCS) utilisation[2].


FSCS protection of up to £4.34m for joint account holders

Flagstone’s secure, user-friendly platform gives clients access to hundreds of deposit accounts from 45 banks through a single application, enabling them to quickly and easily achieve exceptional diversification; with private clients able to benefit from full FSCS protection on deposits of up to £2.30m[2][3] and joint account holders up to £4.34m[2][3].

With clients now aware of the pending NS&I interest rate reductions and many using the extra time available to them during ‘lockdown’ to organise their finances and plan for what might lie ahead, now could be the ideal time to discuss how you can help them to protect their cash and improve their returns from it, by introducing them to Flagstone.


Generate value for your clients and your practice with Flagstone  

The material benefits of using the platform are immediately visible and future value is easy to illustrate. Moreover, introducing clients to Flagstone enhances your understanding of their holistic wealth, with ongoing visibility of their cash portfolios and maturity/liquidity events providing you with regular opportunities to discuss how their cash can be re-invested when market conditions are right.


The time to act is now

The consequences of NS&I’s rate cut announcement will be felt in the wider market in the coming weeks. Banks will no longer be competing on rate with NS&I to attract retail deposits from savers, so it’s important that clients act quickly to secure best-in-market fixed term rates, before they’re reduced. Locking in a fixed term inflation-beating rate now means that the deposit won’t be affected by any falls in market rates over the account’s term and gives peace of mind that the value of the deposit isn’t being eroded by sitting in a suboptimal account.

Fixed term deposit rates exclusively available on the Flagstone platform currently include:

  • 0.95% 6 Month Fixed Term Deposit Account[3]
  • 1.25% 12 Month Fixed Term Deposit Account[3]
  • 1.30% 24 Month Fixed Term Deposit Account[3]

Hundreds of Instant Access Accounts and Notice Accounts are also available on the platform to enable clients to easily plan and manage their liquidity requirements.


Speak to Flagstone

Flagstone is here to provide you and your clients with a solution for cash, and to ensure that you retain ongoing visibility of the asset in order that you can continue to deliver holistic, timely advice. For more information, please don't hesitate to contact us


1 Source: NextWealth, ‘Giving Credence to Cash: Why It’s Time for Financial Advisers to Challenge Their Assumptions’

2 As at 23/09/2020 Financial Services Compensation Scheme (FSCS) deposit protection is £85,000 per depositor per authorised bank (and £170,000 for joint account holders). For more information go to www.fscs.org.uk. Incremental FSCS protection is achieved by diversifying deposits into accounts with different authorised banks.

3 Correct as at 23/09/2020


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