The winners are from Staffordshire and Norfolk, while 71 other premium bond holders received the next-best prize of £100,000.
This month's draw saw the prize fund rate hit a 15-year high of 3.7% and it will rise again to 4% from August. Interest on some of its savings accounts also got a boost.
Here, Which? reveals the winning premium bond numbers and looks at whether NS&I's other products are also worth investing in.
July 2023 premium bond winners
The first winning bond (493HK711899) was bought by a lucky winner living in Staffordshire, and is part of a total holding of £48,750. The winning bond was bought in March 2022.
The second winner, from Norfolk, bought their bond (246DR645231) in May 2015. They have a total holding of £20,000.
Find out more:How many winners were drawn in July?
There were 5,061,349 premium bond prizes paid out in the July draw. Of these, 4,998,800 were worth £100 or less.
In total, this month's prizes were worth £374,539,700.
Find out more:Is NS&I good value for savers?
NS&I is different from other savings providers in that it is a government department and an executive agency of the Chancellor of the Exchequer.
Odds of winning at 15-year high
The chance to win £1m is incentive enough for some people to buy premium bonds and from the August 2023 draw, the prize fund rate will increase to 4% from 3.7%, its highest level since 2007.
It's the second month in a row that the prize fund rate has increased, having gone up from 3.3% to 3.7% for July's draw. NS&I estimates that the changes will see an extra £30m added to the prize fund from August, with an estimated 460,000 extra prizes up for grabs.
Premium bond holders in the last financial year also benefited from five rate increases and, according to NS&I's Annual Report for 2022-23, it meant by March 2023, 1.6 million more prizes were being paid out each month than a year earlier.
Successive increases to the prize fund rate have improved the odds slightly.
From December 2020 to May 2022, the rate was just 1% and the odds 34,500 to 1. When the rate was boosted to 1.5% from 1 June 2022, those odds went up to 24,500 to 1. Another prize fund boost from October's draw pushed the odds to their current level of 24,000 to 1 and from August they will improve again to 22,000 to 1.
Although the odds are at a 15-year high, your chances of winning any prize remain very slim.
Very secure
One of the main advantages of NS&I is that funds are backed by HM Treasury, so your money has 100% security.
With other banks and building societies you’re covered by the Financial Services Compensation Scheme (FSCS), but only up to £85,000 per person, per institution (so some brands share protection).
With NS&I, you’re fully protected up to the maximum deposit limit on the account – for the direct saver that’s up to £2m.
Fnd out more:Savings accounts offer guaranteed returns
If you're not feeling particularly lucky, then NS&I does offer a range of savings and Isa accounts. The main benefit of investing your money in one of these products is they offer guaranteed interest on your deposits.
The question is, can they compete with the record high rates offered elsewhere by banks and building societies?
NS&I's Annual Report claims it has responded to consecutive Bank of England base rate rises and changes in the wider savings market during the last financial year, bringing its one-year Guaranteed Growth Bonds and Guaranteed Income Bonds back on sale and increasing rates on other products, including Direct Saver and Income Bonds.
In June, it also boosted interest on its Junior Isa account from 3.4% AER to 3.65%.
Find out more:How competitive are NS&I's savings?
Here we’ve listed the current rates for NS&I’s savings products:
While it's true interest on NS&I savings products has improved over the last year, rates are still lagging behind those offered by competitors.
According to Moneyfacts data from 30 June, the top rate for a three-year fixed is currently 5.88% AER with JN Bank. NS&I's three-year Green Savings Bond, on the other hand, only offers 4.2%.
There is an even bigger difference between NS&I's one-year fixed accounts. The top rate is a whopping 6% AER with Charter Savings Bank, while NS&I's Guaranteed Income Bonds and Guaranteed Growth Bonds are 2 or more percentage points behind with rates of 3.97% and 4% respectively.
And it's a similar story for instant access accounts - the top rate on the market is currently 4.2% compared to NS&I's best offer of 2.85% on its Direct Saver and 2.89% on its income Bonds. And even after 13 July, when the rates on these accounts are put up to 3.4%, the gap remains significant.
It's a similar picture for Isas. The best rate for an instant access Isa is 3.9% AER, way ahead of the 2.4% offered by NS&I's Direct Isa and NS&I's Junior Isa pays 3.65% compared to 4.3% offered by Coventry Building Society.
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