ISLAMABAD: The National Savings, said on Wednesday it had raised the profit rate on its savings account by one percentage point to 20.5 percent per annum, while lowering the rates on some of its other schemes.
The new rate for the savings account, which applies to accounts where withdrawals are made through methods other than cheques, is effective from Oct. 30, the Finance Division said in a notification.
The rates of national savings schemes are announced every two months and are linked to cut-off yields of long-term Pakistan Investment Bonds. The National Savings cut the profit rate on its Special Savings Account, which offers a higher return than the savings account, by 0.2 percentage point to 18 percent per annum.
The profit rate on Pensioners' Benefit Account and Shuhada's Family Welfare Account, which cater to retired and deceased government employees respectively, was reduced by 0.3 percentage point to 16.3 percent per annum.
The profit rate on Bahbood Savings was also reduced by 0.3 percentage point to 16.3 percent per annum. However, the National Savings increased the profit rate on some of its short-term and regular income certificates by one percentage point each.
The Short Term Savings Certificates, which have a maturity of three months, will now yield 21.8 percent per annum, while the Regular Income Certificates, which have a maturity of five years, will now yield 16.1 percent per annum.
The National Savings also revised the expected rate of profit on its Sarwa Islamic Term Account (SITA), a Shariah-compliant savings scheme that offers different rates for different tenures.
The rate of profit for a three-year SITA account was slightly lowered by 0.1 percentage point to 18.23 percent per annum, while the rate of profit for a five-year SITA account was significantly raised by 0.6 percentage point to 15.72 percent per annum.
The expected rate of profit for a one-year SITA account remained unchanged at 18.5 percent per annum. The profit for SITA accounts is payable on maturity for one-year accounts, half-yearly for three-year accounts and monthly for five-year accounts.
The National Savings also said that the expected rate of profit for its Sarwa Islamic Savings Account (SISA), another Shariah-compliant savings scheme, will be 20.5 percent per annum, the same as the conventional savings account.
The returns on saving accounts and certificates are linked with the central bank’s policy rates and are normally kept slightly higher to ensure better returns to small savers without drastically affecting the government budget.
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 on Monday, citing a projected decline in inflation in the coming months.
Pakistan's headline inflation eased to 26.9 percent year-on-year in October from 31.4 percent in September, according to data released by the statistics bureau on Wednesday.