Home Corporate Customers averse to savings certificates due to conditions
Corporate - August 5, 2022

Customers averse to savings certificates due to conditions

Staff Correspondent: Savings is a safe investment for people of all walks of life. People are interested in buying savings bonds because of safe and guaranteed profits. However, people are gradually discouraged from investing in savings bonds due to various conditions of the government.
From September 2021, the interest rate has been reduced on investments above Tk 15 lakh. Apart from this, there is also a provision of imprisonment and fine if the savings certificate is not declared. In order to invest in savings bonds of more than Tk five lakh, proof of last year’s income tax return must be shown. Due to these reasons, the sale of savings certificates is decreasing.
According to the report of the Directorate of National Savings, in the fiscal year 2021-22, savings bonds worth Tk 1 lakh eight thousand 70 crore were sold in national savings schemes including savings bonds. Against this amount, Tk 88 thousand 155 crores have been paid for principal and profit.
In the financial year 2020-21, the total sales were Tk 1 lakh 12 thousand 188 crore 24 lakh. Which is about four thousand crores more than the last financial year. Out of this, Tk 70 thousand 229 crore have been paid to the customers for the interest-principal of savings certificates.
At the end of the fiscal year 2021-22, the government’s net debt from savings bonds stood at Tk 19,915,750,000, which is 62.23 percent of the target set for this sector to meet the budget deficit. In the fiscal year 2020-21, the government took a net loan of Tk 42 thousand crore by selling savings bonds. Accordingly, the government’s net debt from savings bonds has come down to less than half.
Talked to Ratan Debnath at Central Bank’s Motijheel office. He said, ‘People’s safe investment was the savings certificate. Now the government is discouraging (conditional) investment in savings bonds. Asking to show proof of income tax return deposit. Return has also been made mandatory for opening an account in Post Office Savings Bank. How can we ordinary investors understand so much?’
Media worker Zainal Abedin made the same complaint. He said, ‘People are afraid to invest in the stock market. Many have sought capital. Profits on investment in savings bonds have also been reduced. But it is a place of income for unemployed people. Now sales are decreasing due to various conditions.
He further said, ‘Now investment of more than Tk five lakh in savings certificate or to open a postal savings account, one has to show proof of last year’s income tax return deposit. That is, it is being seen whether the buyer is within the taxable income limit or not. Similarly, if the customer’s bank credit balance exceeds Tk 10 lakh, the bank has to provide proof of return deposit. Proofs must also be given in bank loan applications of more than Tk five lakh or in the case of taking a credit card.
There are four types of savings certificates in the country. They are five-year Bangladesh Savings Certificate, three-month profit-based savings certificate, family savings certificate and pensioner savings certificate. Apart from this, there are investment facilities in Wage Earner Development Bond and Post Office Savings Bank.
From September 22, the government has reduced the interest on savings certificates by 2 percent for investments up to Tk 15 lakh. This has been done to reduce sales so that the government does not have to pay more interest on savings bonds.

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