Around 21 million people in the UK have premium bonds but how are the prizes shared out?

First introduced in 1956, Premium Bonds are an investment product which is issued by National Savings and Investments (NS&I).

With Premium Bonds, you can earn interest or a regular dividend income, you are entered into a monthly prize draw where you can win between £25 and £1 million tax free.

With a max prize of £1 million, many use Premium Bonds accounts as a way to save money whilst being in with a chance to earn.

If you're considering investing in Premium Bonds, MoneySavingExpert founder Martin Lewis has recently shared his expert advice on the topic.

How do Premium Bonds prizes work? 

Premium Bonds prizes are split into three bands: higher, medium and lower value.

They are allocated based on a percentage share of the monthly prize fund to each band.

Higher band

There are two £1 million jackpots each month.

NS&I divide the balance of the prize fund share allocated to the higher value band equally among the remaining prize values.

Explaining how the higher band works, NS&I writes on its website: "First we work out the number of £100,000 prizes.

"When there is a balance that’s less than half of that prize value, we carry it over to the share for the £50,000 prizes. Or when there’s a balance that’s at least half of the prize value, we award an additional prize of £100,000. We do this by taking the shortfall from the share for the £50,000 prizes.

"We then calculate the numbers of other prizes in this value band in the same way, from highest value to lowest value.

"When calculating the number of £5,000 prizes, any surplus or shortfall is added to or taken from the medium value band."

Medium band

NS&I calculates the number of prizes within the medium band so that there is one £1,000 prize for every three £500 prizes.

If there is any leftover, the surplus is added to the share allocated to the lower value band.

Lower band

The number of lower value prizes is so that there’s an equal number of £100 and £50 prizes, the Ns&I has explained.

It added: "The total number of prizes of all values (including £25 prizes) is equal to the number of eligible £1 Bond units divided by the odds".

How to check if you have won on Premium Bonds

You can check your account via the NS&I website.

Prize draws are conducted every month and see prizes of up to £1,000,000 given away.


Recommended reading

What are Premium Bonds, how much interest do they pay and how do they work?


To find out if you have ever won a Premium Bonds prize, you will need to dig out your holder's information and head over to the prize checker.

You will need your holder’s number which you can find on your bond record, or in the app.

You can also use your NS&I number which you should be able to find on any communication about your bonds.