The Premium Bond prize fund rate will be reduced for the third time this year, falling from 3.8% to 3.6% from the August draw.

The odds of winning will remain at 22,000 to 1.

National Savings & Investments said it was cutting rates in response to the changing savings market. 

The Premium Bonds prize fund rate was last changed in April, when it fell from 4% to 3.8%. It was previously changed in January when it was reduced from 4.15%.

The changes mean there will be an estimated 75 prizes of £100,000 in August, down from 79 in June. The estimated number of £50,000 prizes will reduce to 151 in August, from 159 in June.

Meanwhile the estimated number of £25,000 prizes will fall to 302 in August, from 317 in June. There will be an estimated 754 prizes at £10,000 in August, down from 792 in June.

Andrew Westhead, NS&I retail director, said: “This adjustment to the Premium Bonds prize fund rate – the first in four months – reflects the changing landscape for savings.

“By making this adjustment now, we’re able to continue to balance the interests of savers, taxpayers and the stability of the broader financial services sector.”

He said Premium Bonds maintain their “unique appeal by offering complete security backed by HM Treasury, the flexibility to withdraw easily, and the excitement of potentially winning a tax-free prize each month.”

He added that the August draw is expected to deliver more than 6m tax-free prizes worth more than £396m.

 Premium Bonds have offered savers an accessible way to save since November 1956. Individuals can hold up to £50,000 in Premium Bonds. 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