The federal government has increased the surplus ratio of several national savings bonds by 12 to 96 basis points, partly to attract higher investment in government bonds and partly to pass on the benefits of an increase in returns on Pakistani investment bonds.
The Central National Savings Directorate (CDNS), which operates under the Treasury, invests money received from private investors in 3- to 10-year GDPs. So far, CDNS has mobilized a small investment of 28.68 billion euros. Rs in the first five months (July-November) of the current fiscal year compared to 371 billion. Rs in the previous full fiscal year 2020 according to the State Bank of Pakistan.
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People have apparently only invested small amounts in the austerity program due to the interest rate drop since March 2020 and wanted to have money on hand to deal with an adverse situation during the Covid-19 pandemic. In addition, the government has suspended the price maintenance with a face value of Rs 40,000 and Rs 25,000 respectively.
The people have released the forbidden bond. This has partially offset the growth in investment in national savings bonds. “The profit margin for certificates for national savings plans has been adjusted upwards by 12-96 basis points. The highest increase was recorded for Behbood and Regular Income Certificate with 96 basis points to 11.28% and 9.00% respectively, ”reported research firm Arif Habib Limited (AHL).
In addition, the annual profit on Defense Certificates (DSC) increased by 75 basis points to 9.24%. The return on special savings certificates (SSC) was increased by 20 basis points to 7.80%. And the payout rate for short-term savings certificates (STSC) rose 12 basis points to 6.92%. The new investors would make a profit according to the new interest rates.
CDNS manages an investment portfolio of approximately seven million private and institutional investors.However, the government recently banned institutions from investing in savings accounts and certificates. The government uses the investments raised by national savings accounts and certificates to bridge its budget deficit.