The National Savings Directorate has increased the rate of profit on different plans, which would be effective from September 1, 2018 on new issuance, with rate increases falling between one percent and 0.72 percent.

Saving accounts witnessed a high jump of 1 percent as the new rate would now be 6 percent per annum, said a notification of the Central Directorate of National Savings.

Moreover, the rate for Shudafa Welfare Certificate, Pension and Behbood increased by 72 basis points respectively. The new rate would be effective from September 1, 2018, and it would be 10.92 percent.

Special Savings recorded an increase of 80 basis points to 7.60 percent, regular income certificate up by 74 basis points to 8.78 percent and Defense certificate up by 75 basis points to 9.05 percent.

The rate increase has been the third in a row during the year 2018, following the sharp rise in Pakistan Investment Bonds after the rise in the benchmark interest rate of the State Bank of Pakistan.

Discount rate or benchmark interest rate remained unchanged from May 2016 to January 2018 but started creeping up from 6.25 percent thereafter. Likewise the rates of NSS also remained stagnant from February 2017 to May 2018.

Similarly from May 2018 to date the defense certificate rate of profit rose from 7.54 percent to 9.05 percent, up by 1.51 percent. Behbood and Pension certificates increased by 1.56 percent, special saving certificates rose 1.60 percent, regular income certificate up by 1.94 percent and saving accounts up by 2.05 percent.

The rates applicable in February 2017  for behbood and pension was 9.36 percent, special savings certificates 6 percent, regulaor income certificate 6.54 percent and on saving accounts 3.95 percent.

According to the latest data of State Bank of Pakistan in statistical bulletin, the investment in Behbood certificates amounted to Rs 794 billion, special saving certificates Rs 381 billion, regular income certificates Rs 347 billion and defense saving certificates nearly Rs 336 billion.

The size of investment in national savings has reached around Rs 3.6 trillion where during last fiscal year net investment was around Rs 202 billion while in 2016-17 it was around 207 billion.

The Central Directorate of National Savings has recently prepared a new instrument for attracting overseas Pakistanis, the spadework for which has been completed with only approval of the Federal Cabinet remaining.

The overseas Pakistanis could invest in this product from a minimum investment of $1000 or equivalent to Pak rupee and will get return of about six to seven percent per annum on an initial basis.

According to an official, in the first year there has been a possibility that investment might amount to $500 million to $1 billion. Moreover, these products will have a maturity period of three to five years.

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