KARACHI: National Savings has cut the profit rates on most of its savings products by up to 160 basis points, effective from Dec. 19, citing lower market interest rates.
The state-run savings institution, which offers a range of deposit schemes for individual savers, said on Monday that it had reduced the profit rates on special savings accounts, short-term savings certificates, pensioners' benefit accounts, regular income certificates and Behbood savings certificates.
Stack of Rs5,000 and Rs1,000 notes. — AFP/File
The biggest cut was on special savings accounts, which saw a drop of 160 basis points to 16.40 percent per annum, followed by short-term savings certificates, which fell by 96 to 102 basis points depending on the maturity period.
The profit rates on pensioners' benefit accounts and Behbood savings certificates, which cater to senior citizens and widows of martyrs, were lowered by 24 basis points to 16.08 percent per annum.
The regular income certificate, which pays monthly profits to depositors, saw a cut of 96 basis points to 15.12 percent per annum. However, the National Savings kept the profit rates on savings accounts and defense savings certificates unchanged at 20.5 percent and 14.48 percent per annum, respectively.
It also revised the rates on its Sarwa Islamic Term Account (SITA), which offers Shariah-compliant savings options. The profit rates on SITA for one-year, three-year and five-year maturities were changed by 23 to 6 basis points.
The Central Directorate of National Savings has despatched revised rate sheets to all the regional offices with instructions that the existing stock of blank certificates would now be issued at new rates effective December 19, 2023.
The NSS rates are linked with Pakistan Investment Bonds (PIB) for medium and long-term instruments and with T-bills for short-term securities. The revision was in line with the prevailing market scenario and the interest rate policy of the central bank, which has kept its policy rate unchanged at 22 percent.
The revision in the rates of return on the National Savings schemes came after the central bank kept the key interest rate unchanged at 22 percent last week, citing a projected decline in inflation in the coming months.
