Throughout the coronavirus crisis, the state-owned savings institution has consistently offered market-leading rates while other banks made cuts in the face of the economic uncertainty caused by the pandemic.

However, from today, NS&I will cut rates on the majority of its accounts, with some falling by more than 99pc.

Its Income Bonds, which currently lead the market with a rate of 1.16pc, will pay just 0.01pc. Direct Saver customers will earn 0.15pc, down from 1pc, and the return from NS&I’s Investment Accounts will fall from 0.8pc to 0.01pc.

Isa savers will also suffer. Returns for Direct Isa customers will drop from 0.9pc to 0.1pc and for Junior Isas will fall from 3.25pc to 1.5pc. Someone with £10,000 in NS&I Income Bonds would currently earn £116 in interest over the course of a year, The Telegraph reports.

At the same time, the odds of winning on Premium Bonds, currently 24,500 to 1 will lengthen to 34,500 to 1 from December. NS&I will also cut the prize fund, meaning that the effective interest rate drops from 1.4pc to 1pc.

Kevin Brown, savings specialist at Scottish Friendly labelled today as “the day that many savers will have been dreading”.

He said: “Up until now, the Treasury-backed bank has offered some solace to savers as it’s maintained rates while many banks and building societies pulled back from the market following the Bank of England’s decision to reduce interest rates to 0.1%. NS&I experienced five consecutive months of record purchases of Premium Bonds and savers poured money into accounts as its rates edged towards the top of the best buy tables.

“But with options for savers now limited, it could be a good time for people to review their finances and make decisions on how they can potentially make their money work harder.

“This might involve shopping around for market-leading rates or choosing to prioritise paying off debts, as interest rates on credit repayments are likely to exceed interest earned on cash savings.

“In the current climate, not everyone will be able to save regularly, but it’s important that people try to do so whenever they can. If you only have a small amount to save or invest on an irregular basis, it’s better to put that money away as you may still be surprised by how quickly it begins to add up.”