KARACHI: On the back of State Bank of Pakistan enhancing the interest rate, the government-owned National Savings has also enhanced the rate of profit by 12 to 50 basis points on national saving schemes with effect from July 1, 2018, according to the Central Directorate of National Savings (CDNS).
This is the second time in the last three months that the government has revised up the rates.
The State Bank of Pakistan (SBP) has increased the key interest rate by 75 basis points altogether since January 2018, taking it to 6.5%.
He elaborated that the adjustment in the rate of profit on the saving schemes was due since banks revised up the rate of returns on their saving accounts.
Since the enhanced rate falls in minuscule territory it may not result in any major boost in savings, said an industry source.
The National Saving is meant to inculcate the habit of saving amongst the citizens by offering relatively higher than the market rate of interest, and, in turn, uses the amounts rather sizable amount thus raised as loans for budget and project financing.
The latest CDNS announcement said, the rate of profit on Behbood Saving Certificates (BSCs), Pensioner Benefit Accounts, and Shuhada Family Welfare Account has been increased by 12 basis points each to 10.20%.
The BSCs offer a higher rate of return with a 10-year maturity period. When launched on July 30, 2003, the BSC was meant for windows only but later the government decided to extend the facility to senior citizens aged 60 years and above with effect from January 1, 2004, with further extensions special persons or special minors through guardians with effect from April 23, 2018.
In May 2018, the government launched the Shuhada Family Welfare Account, intended for the families of martyrs.
The government has also increased the rate of profit on Defence Savings Certificates by 20 basis points to 8.30%. The rate of profit on Special Savings Certificates (Registered)/Accounts has been increased by 30 basis points to 7.10%.
The interest on Regular Income Certificates has been increased by 0.408% to 8.40%, while the Savings Account shall now fetch 50 basis points more, yielding 5% interest.
The rate of profit on Short-Term Savings Certificates; 3-month, 6-month and 1-year has been increased to 6.40%, 6.46%, and 6.56%, respectively, from 5.92%, 6.04%, and 6.25%.
