National Savings reduces profit rates by up to 375bps

September 12, 2024 (MLN): The Central Directorate of National Savings (CDNS) has once again slashed the profit rates on majority of its National Savings Schemes, with the decline going as much as 375 basis points (bps), according to its website.

To note, the decrease comes after it slashed profit rates earlier this month.

The new profit rates are effective from September 25, 2024.

Rates per annum

The profit rates were reduced by 375bps on Sarwa Islamic Savings Account (SISA), 310bps on both Special Savings Account & Certificates (SSA-SSC), 300bps on Savings Account (SA), and 211bps on Sarwa Islamic Term Account (SITA).

In addition, the rates were reduced by 180bps on Regular Income Certificates (RIC), 120bps on Bahbood Savings Certificates (BSC), Pensioner Benefit Account (PBA), and Shuhada Family Welfare Account (SFWA), and 106bps on Defence Savings Certificates (DSC).

Meanwhile, the profit rates on Short Term Savings Certificates (STSC) remained at 17.22%.

These adjustments in profit rates come as part of the government's efforts to align the National Savings Scheme rates with broader macroeconomic objectives, particularly in an environment of declining interest rates and inflation.

The State Bank of Pakistan (SBP) again lowered its key policy rate by 200 basis points to 17.5% on September 12, compared to a median estimate for a 150bps cut.

The reduction was the third in a row, bringing the total decrease since June 2024 to 450bps as a slowdown in inflation give policymakers enough room to continue monetary easing in a bid to spur growth.

Copyright Mettis Link News