Govt revises interest rates on savings certificates, notification issued
The new rates, effective from1 Jan, will be revised every 6 months
Highlights
- 5-yr Bangladesh savings certificate: 12.40%, up from 11.28%
- 3-month profit-based savings certificate: 12.30%, up from 11.04%
- Pensioners' savings certificate: 12.55%, up from 11.76%
- Family savings certificate: 12.50%, up from 11.52%
- Postal savings bank fixed deposit: 12.30%, up from 11.28%
The government has revised the interest rates for five national savings schemes to align with the market rate for the first time, resulting in an increase in the interest rates for all savings certificates.
In a notification issued today (15 January), the Internal Resources Division of the Ministry of Finance announced the revised rates, which took effect on 1 January.
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This means that savings certificates activated on or after that date will be subject to the new, increased interest rates.
The revised rates will apply for the period from January to June, with adjustments scheduled every six months to reflect market conditions.
Previously, the interest rates for savings certificates were determined in three tiers: Investors with up to Tk15 lakh received the highest interest rate, those investing between above Tk15 lakh and Tk30 lakh received a lower rate, and investments above Tk30 lakh were subject to the lowest rate. The general rule was that the larger the investment, the lower the interest rate.
The new notification has simplified the system by introducing two categories: one for investments up to Tk7.5 lakh and another for investments exceeding Tk7.5 lakh. As before, the interest rate for premature encashment will remain applicable at an annual rate.
The Internal Resources Division stated that the changes aim to create greater equity for disadvantaged groups, though they will result in higher government expenditure.
Revised interest rates
The four types of savings certificates under the national savings scheme now feature revised interest rates.
The five-year Bangladesh savings certificate offers a maximum rate of 12.40%, up from 11.28%.
The three-month profit-based savings certificate now offers 12.30%, an increase from 11.04%.
The pensioners' savings certificate rate has been raised to 12.55%, from 11.76%, while the family savings certificate, the most popular option, now offers 12.50%, up from 11.52%.
Additionally, the interest rate for postal savings bank fixed deposit accounts has been updated to 12.30%, up from the previous 11.28%.
In a press release, the Internal Resources Division says the interest rates for these five savings schemes will now be revised biannually, in line with the rates for five-year and two-year treasury bonds. Investors will receive the prevailing interest rate for the full term of their certificate.
Benefits for marginalised investors expected
The revisions are expected to benefit marginalised investors in the country and increase participation in the national savings scheme, which provides opportunities for women, retired professionals, pensioners, senior citizens, and people with disabilities to secure financial and social safety nets.
This reform is hoped to enhance the effectiveness of these benefits, the resources division press release added.
