Green Savings Bonds will help finance the government’s green spending projects designed to tackle climate change
National Savings & Investments (NS&I) has confirmed it will launch Green Savings Bonds, which will allow savers to support projects tacking climate change, later this year.
The bonds will be available to savers aged 16 and over, pay a fixed interest rate over a three-year term, and have a minimum investment of £100 and a maximum limit of £100,000 per person. Once they invest, they will not be able to access their money until it reaches the end of its term.
However, the interest rate for the savings accounts has not yet been announced. Customers must have a UK bank account capable of receiving BACS payments.
At least £15 billion of green gilts are expected to be issued this financial year.
Green Savings Bonds will help finance the government’s green spending projects designed to tackle climate change and make the environment greener and more sustainable.
Zero-emissions buses, offshore wind and buildings decarbonisation schemes, will be among the projects that will benefit from the green bonds.
The social benefits of the projects are expected to be reported, to give investors insight into the number of jobs created and SMEs or households who have benefitted.
Money held in the bonds 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.
Ian Ackerley, NS&I chief executive, said: We are delighted to be offering a new savings product on behalf of the government and playing a key role in contributing towards the UK’s green agenda. This exciting new bond will be available to purchase from nsandi.com later this year and will give UK savers the opportunity to contribute towards green projects to help make the world greener, cleaner and more sustainable.
Sarah Coles, personal finance analyst at Hargreaves Lansdown, said: The N&I Green Savings Bond 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.
She said: 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.