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NSS records Rs296bn outflows during 11MFY22

July 7, 2022 (MLN): The cumulative outflows from the National Savings Schemes (NSS) in 11MFY22 were recorded at Rs295.9 billion, mainly due to the restrictions imposed on financial institutions to invest in these schemes, Central bank data showed on Thursday.

Moreover, registration requirements for prize bonds of higher denominations and strict implementation of anti-money laundering laws and know-your-customer (KYC) conditions have also had a negative impact on fund mobilization.

In the month of May 2022 alone, investors pulled out Rs59.88bn, compared to Rs149.6bn last month which was the highest outflow recorded in the FY22.

To recall, during FY21, the NSS witnessed a huge outflow of Rs317.31bn, compared to the inflows of Rs370.9bn recorded in FY20, which was the second-highest annual mobilization achieved in the 17-year period.

During 11MFY22, the highest outflows of Rs198.35bn and Rs68.64bn were observed in Other saving schemes and Prize bonds, followed by special saving certificates and Defense saving certificates with an amount of Rs40.8bn, and Rs9.4bn respectively. On the other hand, regular income certificates attracted Rs21.4bn.

In April 2022, most of the outflows were recorded in other saving schemes (Rs48.4bn) followed by Special Saving certificates (Rs10.6bn), Regular Income Certificates (Rs1.2bn), and defense saving certificates (Rs600.9mn). While Prize Bonds were the only major source of inflows as they fetched Rs952.5mn in investments during the month.

It is pertinent to mention that amid higher policy rate and the recent increase in cut-off yields of T-Bills, the Central Directorate of National Savings (CDNS) on June 02, 2022, increased profit rates on almost all national savings schemes.

Accordingly, the profit rate has been increased by 36bps to 12.36% per annum on Regular Income Certificates (RICs) while the deposit rate on savings accounts jumped by 1.5% to 12.25% from 10.75%.

Moreover, special saving certificates have their profit rose by around 60bps to 13% from 12.40%.

However, the profit rate on behbood, pension, and shuhda family remained unchanged at 14.16%.

Copyright Mettis Link News

Posted on: 2022-07-07T15:34:06+05:00

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