Govt revises profit rates on savings schemes

ISLAMABAD: The government of Pakistan has made adjustments to the profit rates offered on national savings schemes, including their Islamic financial products and accounts. These changes went into effect on October 30, as per an official notification released by the Ministry of Finance.

One of the notable changes is the increase in the profit rate on savings accounts, which has been raised by 1 percent to a new rate of 20.5 percent per annum. Similarly, the profit rate on special savings accounts has seen a 20-basis point increase, reaching a rate of 18 percent.

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Conversely, the profit rate on deposits in Pensioners’ Benefit Accounts, Bahbood, and Shuhada’s Family Welfare Account has been reduced, now fixed at 16.32 percent per annum, down from the previous 16.56 percent.

Furthermore, the return on short-term one-year certificates has been adjusted to 21.72 percent, a notable increase from the previous rate of 19.82 percent.

It’s important to note that there have been no changes announced for the one-year Sarwa Islamic Term Accounts (SITA), which will continue to be available to investors at a rate of 20.80 percent. However, the expected rate of return for a three-year SITA has been increased to 18.23 percent, effective from October 30, compared to the previous rate of 18 percent set in June this year. Similarly, the expected return on five-year SITA has been revised to 15.72 percent from the previous 12.84 percent, marking a substantial increase of nearly 3 percent.

In addition to these adjustments, the Sarwa Islamic Saving Account (SISA), which operates as a running account, will now offer a return of 20.50 percent, up from the previous rate of 19.50 percent. These financial products are scripless, and the profits earned will be deposited into either the investors’ bank accounts or national savings accounts through Raast accounts, depending on the specific arrangement.

The Central Directorate of National Savings (CDNS) has promptly distributed revised rate sheets to all regional offices, along with instructions to issue blank certificates at the new rates, effective from October 30, 2023. These changes have implications for a wide range of savers and investors across the country.

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