The Premium Bonds prize pot is being cut from May 1 (NS&I/PA)

Savers will be dealt another blow from Monday as NS&I snips some of its savings rates and slashes the Premium Bond prize pot.

In a move affecting more than 21 million customers, the changes taking place from May 1 apply to Premium Bonds, the Direct Isa, the Direct Saver and Income Bonds.

NS&I (National Savings and Investments) has said the move, announced in February, follows reductions in interest rates across the savings market, after the Bank of England base rate was cut to 0.25% in August.

Money held with NS&I is 100% backed by the Treasury. NS&I has a duty to balance the needs of savers and taxpayers and help ensure the stability of the broader financial services sector.

The changes see a 1% rate on NS&I's Direct Isa fall to 0.75%, a 0.8% rate on its Direct Saver fall to 0.7% and a 1% rate on Income Bonds fall to 0.75%.

The estimated number of Premium Bond prizes in May will be 2,219,493, down from 2,268,165 in April's draw.

The total Premium Bond prize fund value will fall from £70,880,100 in April to an estimated £63,810,400 in May.

The reduced prize pot will see the estimated number of £100,000 prizes fall from three to two and there will be an estimated nine £25,000 prizes in May, compared with 13 in April.

Hannah Maundrell, editor in chief of money.co.uk, said : "If you've got a chunk of your money invested in NS&I Premium Bonds it really is time to start weighing up your options."

Earlier in April, NS&I launched a three-year investment bond with a rate of 2.2%. Savers can put between £100 and £3,000 into the new Investment Guaranteed Growth Bond deal, which is on sale at nsandi.com for a 12-month period.