Now there’s less chance of winning big on Prize Bonds

NTMA alters interest rate so prize pot is reduced – in line with falling cost of borrowing

Interest rate used to calculate prize pot on Prize Bonds dropped from  0.85 to 0.5 per cent. Photograph: iStock

Interest rate used to calculate prize pot on Prize Bonds dropped from 0.85 to 0.5 per cent. Photograph: iStock


Holders of State-backed Prize Bonds will have less chance of winning big following a reduction in the overall money pot.

The National Treasury Management Agency (NTMA) has announced a reduction in the interest rate on which the overall prize kitty is calculated, reflecting a drop in interest rates generally.

Prize Bonds are essentially a method by which the State borrows money, in this case from members of the public.

The current value of prize-bond investment is just over €3 billion and the amount of cash prizes available is based on a percentage of that figure – which has now dropped from 0.85 per cent to 0.5 per cent.

If those figures remained constant, it would mean an overall prize fund of €15 million. This decision to reduce the rate reflects the falling cost of borrowing money generally.

The idea behind the prize bond system is that rather than paying a small interest rate to those who invest, that money goes into a giant cash pool from which a lucky minority will benefit.

Hundreds of thousands of people hold Prize Bonds, the number going up and down as they are cashed in. With a minimum buy in of €25, they are commonly given to people as gifts.

Last year, €28 million was paid out in 392,000 cash awards ranging in value from a top €1 million prize to individual payments of €50.

In the first half of this year, the number was €12.6 million across 182,000 prizes.

However, due to today’s decision to alter the variable interest rate from August, the number of high-end prizes will be reduced.

The new breakdown will include a top weekly prize of €50,000, while the last weekly draw in June and December will shoot up to €1 million.

Each week there will continue to be 10 prizes of €1,000 and 10 of €500. The remaining weekly fund will be distributed in €50 prizes.

“The interest rate reduction reflects changes across the retail savings market and the fall in the cost of borrowing by the State,” an NTMA spokesman said. “However, the change also maintains the balance of remaining competitive and providing good value for the holders of Prize Bonds.”

Interest rates applied to other State savings schemes such as An Post savings and national solidarity bonds – whose overall value are in the region of €20 billion – have not been amended.