Interest rates on savings schemes increase
Govt plans to borrow Rs230b through these schemes.
ISLAMABAD:
The government on Friday increased interest rates for National Saving Schemes in the range of 0.25 to 1.2 per cent to match the rising interest rate in the market and keep running its important budget financing line.
The new rates will come into effect from January 1, 2011. The maximum increase was given on savings certificates. Return on these certificates has been increased to 13.33 per cent from 12.13 per cent, showing a jump of 1.2 per cent.
The lowest raise was given on savings accounts, which was 0.25 per cent. The new interest rate on savings accounts would be nine per cent.
Owing to soaring inflation the State Bank has increased the discount rate - a rate at which it lends money to commercial banks, to 14 per cent. The government is borrowing from the market at more than 13.5 per cent.
Assistant Director Schemes of the Directorate of National Saving Schemes Abdul Ghafoor Baloch said during the period July through November the government borrowed Rs80 billion through savings schemes to finance the budget.
The government has targeted to borrow Rs230 billion through these schemes for bridging the gap between income and expenditure. During the last financial year, the government borrowed Rs225 billion through savings schemes. These schemes have total deposits of Rs1.7 trillion.
Interest rate on Defence Saving Certificates has been increased to 13.55 per cent from 12.6 per cent on October 1, a jump of 0.95 per cent. On Regular Income Certificates, the rate has been jacked up to 13.44 per cent, a rise of 1.08 per cent.
Interest rate on Behbood Saving Certificates and Pensioners Benefit Accounts has been increased to 15.36 per cent from 14.64 per cent, up 0.72 per cent.
Published in The Express Tribune, January 1st, 2011.
The government on Friday increased interest rates for National Saving Schemes in the range of 0.25 to 1.2 per cent to match the rising interest rate in the market and keep running its important budget financing line.
The new rates will come into effect from January 1, 2011. The maximum increase was given on savings certificates. Return on these certificates has been increased to 13.33 per cent from 12.13 per cent, showing a jump of 1.2 per cent.
The lowest raise was given on savings accounts, which was 0.25 per cent. The new interest rate on savings accounts would be nine per cent.
Owing to soaring inflation the State Bank has increased the discount rate - a rate at which it lends money to commercial banks, to 14 per cent. The government is borrowing from the market at more than 13.5 per cent.
Assistant Director Schemes of the Directorate of National Saving Schemes Abdul Ghafoor Baloch said during the period July through November the government borrowed Rs80 billion through savings schemes to finance the budget.
The government has targeted to borrow Rs230 billion through these schemes for bridging the gap between income and expenditure. During the last financial year, the government borrowed Rs225 billion through savings schemes. These schemes have total deposits of Rs1.7 trillion.
Interest rate on Defence Saving Certificates has been increased to 13.55 per cent from 12.6 per cent on October 1, a jump of 0.95 per cent. On Regular Income Certificates, the rate has been jacked up to 13.44 per cent, a rise of 1.08 per cent.
Interest rate on Behbood Saving Certificates and Pensioners Benefit Accounts has been increased to 15.36 per cent from 14.64 per cent, up 0.72 per cent.
Published in The Express Tribune, January 1st, 2011.