Savers to be offered new green government-backed bond as sustainability demands grow
David Attenborough warns world leaders about climate change
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The scheme will be 100 percent government guaranteed and the money raised will be ploughed into environmental projects and create new jobs helping the UK reach its net zero carbon targets. Personal finance analyst Sarah Coles of adviser Hargreaves Lansdown said:
“The government is hoping to cash in on the demand for sustainable savings. It’s offering a winning combination of helping savers support green projects, while protecting them with the strength of the NS&I name, and the 100 percent government backing.”
But the green bond’s term and rate is still unknown.
“There’s the hope that NS&I will take the opportunity to expand its range by offering something really attractive,” added Coles.
“Savers wanting to support green projects already have some competitive options, including the Gatehouse green savings bond, offering 0.55 percent for one year, 0.75 percent for two years and 1.4 percent for five years. There’s the hope that this bond will compete effectively.
“However, on the flip side, from the government’s perspective, funding is so cheap at the moment, and savers have so much money sloshing around right now, that it doesn’t make sense to pay over-the-odds.
“Unfortunately, there’s every sign that the rest of its savings rates will continue to disappoint for the next financial year. NS&I’s financing target for next year is just £6 billion – a dramatic drop from this year’s target of £30-£40 billion. The green bond isn’t included in this target, so it’s a strong indication that aside from the new bond, we’re highly unlikely to see any strong rates from NS&I in the coming year.
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