Savers will be able to apply for Premium Bonds with a minimum £25, down from £100 with the change taking effect by the end of March 2019.

The government’s savings arm, NS&I, said this is the lowest threshold since 1993. Customers will also be able to set up a standing order of £25 on a regular basis, down from the current £50 minimum imposed.

However, there’s no change for the maximum amount you can save in Premium Bonds – this remains at £50,000.

Gifting Premium Bonds to children

Currently, only parents, legal guardians and grandparents can buy Premium Bonds for children. But NS&I has announced that other adults, such as aunts, uncles, godparents and family friends will be able to buy the bonds for kids under the age of 16.

They will then have to nominate one of the parents or guardians to look after the bonds until the child turns 16.

Since the £1 million jackpot prize was introduced in 1994, there have been ten winners of the top prize who were under 16 at the time of winning. See YourMoney.com’s Kids can win £1m too: a parent’s guide to buying Premium Bonds for more information.

NS&I also confirmed its launching a new app in the New Year.

Ian Ackerley, NS&I chief executive, said: “Premium Bonds have helped tens of millions of people to save since their launch in 1956 and these new improvements will make Premium Bonds more accessible. Our customers are increasingly dealing with NS&I online, and the development of the app will give customers the option to help them manage their money with us in a way that suits them.

“Customer feedback is always an important part of our decision-making, and we found that the current £100 minimum purchase was too much and recognised that people other than parents or grandparents wanted to gift Premium Bonds to children.

“By lowering the minimum investment and making gifting for children accessible to all adults, we are extending the opportunity for more people to save and trying to encourage a savings habit, especially among younger people. This supports a strong savings culture for families in a product that has spanned the generations, and for those who want to save little and often.”