Pakistan has increased the profit rates on various saving scheme after massive raise in benchmark interest rate by the central bank.
(more…)Tag: CDNS
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President Alvi bars retrospective effect to profit rates on saving certificates
ISLAMABAD: The President of Pakistan Dr. Arif Alvi, while rejecting the retrospective effect of government decision, has directed the authorities to pay profit rate on saving certificates on prevailing rates.
While accepting a representation of an aggrieved citizen against a decision of the Wafaqi Mohtasib, President Dr Arif Alvi has directed the Central Directorate of National Savings (CDNS) to pay profit on the Special Saving Certificates (SSCs) as per the profit rate prevailing at the time of purchasing the certificates.
READ MORE: President Alvi directs State Life Insurance to pay compensation
He said that CDNS had committed maladministration by revising the profit rates retrospectively and in contrary to the existing law, thus causing the citizen a loss of Rs 5.3 million.
The President issued these directions while deciding on a representation preferred by Ms Yasmeen Merchant, who had purchased six SSCs from CDNS on 01.11.2019 at a profit rate of 12.7 per cent for five certificates and 13.9 per cent profit rate for the sixth certificate.
READ MORE: President Alvi rejects Habib Bank plea, orders to pay victims
Four days later on 05.11.2019, however, Finance Division issued a notification reducing the profit rates from 12.7 per cent to 11 per cent and 13.9 per cent to 11.8 per cent with retrospective effect from 01.11.2019, causing her a loss of Rs 5.3 million.
The President accepted her representation and held that the complainant was entitled to the profit rate prevailing on the date of issuance of certificates and that the change made through the notification did not apply to her investment in retrospective and, therefore, it could not affect her duly earned right of profit nor it can nullify it to her disadvantage.
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He said that the notification issued was in the nature of subordinate or delegated legislation and took effect from the date of its publication in the official Gazette and not from any prior date.
The President added that the rationale behind it was that only the Parliament/legislative bodies could enact a law from a date prior to its enactment i.e., retrospectively and the Government by itself, unless authorized by the statute, had no such authority or power to issue a notification operative from a date different from the date of its publication in the official Gazette.
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The President further highlighted that a person may feel allured by the incentives floated by the Government and act upon it, and it did not behove the Government to recant on its commitment as it may erode the confidence of the general public in the government bodies and may also negatively affect the credibility of the Government.
He further stated that such law was based on settled legal principles and Quranic injunctions as per the 1st verse of Surah Al-Maida “O ye who believe! Fulfil your undertakings”.
The President held that it was not only logical, fair and just to fulfil promises, undertakings and agreements but was also a universally accepted norm. He further declared that both sides were bound by the commitments made at the time of issuance of certificates and directed CDNS to pay the profit as per the promised profit rates of 12.7 per cent and 13.9 per cent on the purchased certificates.
As per details, the citizen’s grievance was that she had purchased the SSCs because of the prevailing profit rate whereas the notification gave retrospective effect to the profit rates and was issued after investment to her disadvantage.
She approached CDNS and later the Wafaqi Mohtasib for redressal of her grievance but to no avail. She then filed a representation with the President, which he accepted.
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National Savings stops profit coupons after August 31, 2022
ISLAMABAD: The Central Directorate of National Savings (CDNS) has announced that it will not issue profit for various savings schemes through coupons.
In a public notice, the CDNS said that laws have been amended related to regular income certificates, Behbood Saving Certificates and Pensioners Benefit Account.
READ MORE: Pakistan increases profit rates for saving accounts
According to the amendments, the investors of saving schemes are required to open saving accounts for receiving profits directly to their accounts.
The CDNS advised the investors to visit their nearest national saving branches and open their saving accounts by August 31, 2022.
The national savings said that it will not allow to release profit through coupons.
READ MORE: Pakistan hikes key policy rate by 125 basis points to 15%
Recently, the CDNS has increased profit rates for saving accounts to 13.50 per cent per annum from 12.25 per cent.
According to Arif Habib Limited, the authority announced the increase in profit rates for two schemes.
The profit rate of savings accounts has been increased by 125 basis points to 13.50 per cent from 12.25 per cent.
READ MORE: Pakistan may see further 100bps hike in policy rate
Similarly, the profit rate has been increased for regular income certificates by 24 basis points to 12.60 per cent from 12.36 per cent.
However, profit rates for other schemes are remained unchanged. The profit rates for the other scheme are: Defence Saving Certificate at 12.40 per cent; Behbood Saving Certificate at 14.16 per cent; Special Saving Certificates at 13 per cent; and Pensioner Benefit Account at 14.16 per cent.
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No date extension for exchanging Pakistan prize bond
KARACHI: Pakistan has not extended the date for exchanging bearer prize bonds that were expired on June 30, 2022.
A number of persons have reached PkRevenue.com regarding extension for exchanging bearer prize bonds. However, there is no information from the finance ministry of the State Bank of Pakistan (SBP) regarding date extension.
READ MORE: Pakistan-issued prize bonds expire on June 30, 2022
So far no decision came from the finance ministry to extend the last date for exchanging bearer prize bonds. The federal government had already extended the last date for converting or exchanging the bearer prize bonds up to June 30, 2022.
The State Bank of Pakistan (SBP) issued a circular on March 30, 2022 to extend the date up to June 30, 2022 for exchanging or converting the bearer prize bonds including denominations of Rs40,000/- Rs25,000/-, Rs15,000/- and Rs7,500.
READ MORE: SBP directs banks to accept bearer prize bonds
Earlier, the last date for exchanging the bearer prize bonds was March 31, 2022.
The SBP instructed the banks to accept requests for encashment / conversion / redemption of cited denominations from general public till June 30, 2022.
“Further, the banks shall submit branch / region wise consolidated data of cited denomination national prize bonds held by them on last date i.e. June 30, 2022 latest by July 04, 2022, as per the instructions stipulated in aforementioned CMD Circulars.
READ MORE: Prize bond (bearer) holders given 3 months to document
The finance ministry launched the withdrawal of the unregistered prize bonds in a phased manner. The federal government on June 24, 2019, announced to discontinue the circulation of Rs40,000 denomination national prize bonds. Similarly, on December 10, 2020, the government announced to discontinue the circulation of Rs25,000 denomination prize bonds. In April 2021, the finance ministry announced that national prize bonds of denominations Rs7,500 and Rs15,000 shall not be sold.
Since June 2019 the government repeatedly extended the date for exchanging the bearer bonds. Previously, the last date for exchanging the unregistered bonds was December 31, 2021.
READ MORE: History of Prize Bonds in Pakistan
The government is aiming to document the bearer bonds so the exchanging the unregistered bond with cash has been prohibited. The ministry of finance issued various procedure to convert the bond without exchanging with the cash.
The bonds can be converted to premium prize bonds (registered) of denomination of Rs25,000 and Rs40,000 (subject to the adjustment of differential amount) through 16 field offices of State Bank of Pakistan (SBP) Banking Services Corporation (BSC), and branches of six commercial banks i.e. National Bank of Pakistan, Habib Bank Limited, United Bank Limited, MCB Bank Limited, Allied Bank Limited, and Bank Alfalah Limited.
READ MORE: Income tax on prize bonds, lottery winning
The bonds can be replaced with Special Saving Certificates/Defence Saving Certificates through the 16 field offices of SBP Banking Services Corporation, authorized commercial banks, and the National Savings Center.
The bonds will only be encashed by transferring the proceeds to the bonds holder’s bank account through the 16 field offices of SBP BSC as well as the authorized commercial bank branches and to the Saving Accounts at National Savings Centers.
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Pakistan-issued prize bonds expire on June 30, 2022
KARACHI: The prize bonds of various denominations issued by the government of Pakistan are expiring on June 30, 2022.
So far no decision came from the finance ministry to extend the last date for exchanging bearer prize bonds. The federal government has already extended the last date for converting or exchanging the bearer prize bonds up to June 30, 2022.
The State Bank of Pakistan (SBP) issued a circular on March 30, 2022 to extend the date up to June 30, 2022 for exchanging or converting the bearer prize bonds including denominations of Rs40,000/- Rs25,000/-, Rs15,000/- and Rs7,500.
Earlier, the last date for exchanging the bearer prize bonds was March 31, 2022.
READ MORE: SBP directs banks to accept bearer prize bonds
The SBP instructed the banks to accept requests for encashment / conversion / redemption of cited denominations from general public till June 30, 2022.
“Further, the banks shall submit branch / region wise consolidated data of cited denomination national prize bonds held by them on last date i.e. June 30, 2022 latest by July 04, 2022, as per the instructions stipulated in aforementioned CMD Circulars.
READ MORE: Prize bond (bearer) holders given 3 months to document
The finance ministry launched the withdrawal of the unregistered prize bonds in a phased manner. The federal government on June 24, 2019, announced to discontinue the circulation of Rs40,000 denomination national prize bonds. Similarly, on December 10, 2020, the government announced to discontinue the circulation of Rs25,000 denomination prize bonds. In April 2021, the finance ministry announced that national prize bonds of denominations Rs7,500 and Rs15,000 shall not be sold.
Since June 2019 the government repeatedly extended the date for exchanging the bearer bonds. Previously, the last date for exchanging the unregistered bonds was December 31, 2021.
READ MORE: History of Prize Bonds in Pakistan
The government is aiming to document the bearer bonds so the exchanging the unregistered bond with cash has been prohibited. The ministry of finance issued various procedure to convert the bond without exchanging with the cash.
The bonds can be converted to premium prize bonds (registered) of denomination of Rs25,000 and Rs40,000 (subject to the adjustment of differential amount) through 16 field offices of State Bank of Pakistan (SBP) Banking Services Corporation (BSC), and branches of six commercial banks i.e. National Bank of Pakistan, Habib Bank Limited, United Bank Limited, MCB Bank Limited, Allied Bank Limited, and Bank Alfalah Limited.
READ MORE: Income tax on prize bonds, lottery winning
The bonds can be replaced with Special Saving Certificates/Defence Saving Certificates through the 16 field offices of SBP Banking Services Corporation, authorized commercial banks, and the National Savings Center.
The bonds will only be encashed by transferring the proceeds to the bonds holder’s bank account through the 16 field offices of SBP BSC as well as the authorized commercial bank branches and to the Saving Accounts at National Savings Centers.
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National Savings connects with Raast payment system
KARACHI: State Bank of Pakistan (SBP) on Sunday announced successful integration of Central Directorate of National Savings (CDNS) with Raast payment system.
“Now customers of CDNS can receive their payments directly into their bank accounts without going to branches,” the SBP said.
READ MORE: SBP launches free P2P money transfer under Raast
Through this integration with Raast, customers receive their payments in bank accounts in a free, fast and secure way. This will make life easier for those interested in saving schemes, the central bank said.
CDNS is the first Government entity on-boarded on Raast that will greatly extend SBP’s efforts to digitize payments in Pakistan.
Raast is Pakistan’s first instant payment system that has enabled end-to-end digital payments among individuals, businesses and government entities instantaneously.
READ MORE: PM Imran launches 2nd phase of Raast payment system
The state-of-the-art Pakistan’s Faster Payment System has been used to settle small-value retail payments in real time while at the same time provide a cheap and universal access to all players in the financial industry including commercial banks, microfinance banks, government entities and fintechs (EMIs & PSPs).
Pakistan has had low electronic transactions for a number of reasons including low banking penetration, lack of trust and awareness of digital payment methods, limited interoperability, difficult accessibility and high cost of transactions. The Real Time Gross Settlement System (RTGS) of Pakistan provides instant payment settlements for large value and corporate transactions only.
Recently, the SBP withdrew transactional limits of payments made through Raast System i.e. Raast Person-to-Person (P2P) Payment System.
READ MORE: SBP withdraws Raast payment transaction limits
The SBP issued Circular No. 02 dated March 15, 2022 and stated that to further facilitate users of Raast services it has been decided that with effect from April 1, 2022, there will be no transactional limits on Raast system by SBP.
Banks/MFBs/EMIs may however set, in their system Raast transaction limits for their customers based on their risk profile in compliance with the relevant Anti-Money Laundering (AML)/Counter Financing of Terrorism (CFT) requirements.
READ MORE: CDC successfully processes dividends through RAAST payment gateway
Further, through previous Circular No. 01 dated February 03, 2022, in terms of para 3 (f) of the circular, customer transaction limits for Raast payments shall not be less than Rs.200,000/- per transaction or the transaction limits applicable as per the account type and prescribed by SBP from time to time.
The aggregate customer limit assigned to Raast payments shall not be less than the Interbank Fund Transfer (IBFT) limit, the SBP said.
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4th draw of Rs25,000 premium prize bonds announced
Central Directorate of National Savings (CDNS) has held Fourth draw of Rs25,000 denomination prize bonds (premium or registered) and announced Rs30 million as first prize to the bond number (016253) and (067408).
The prize bond draw was held at Quetta on December 10, 2021.
Five bonds i.e. (038203), (171265), (551833), (655804) and (916353) have been awarded Rs10 million each as the second prize.
Whereas 700 prizes of Rs300,000 each to the following numbers of prize bonds:
Please click the link to check the numbers.
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19th draw of Rs40,000 premium prize bonds announced
Central Directorate of National Savings (CDNS) has held 19th draw of Rs40,000 denomination prize bonds (premium or registered) and announced Rs80 million as first prize to the bond number (953829).
The prize bond draw was held at Lahore on December 10, 2021.
Three bonds i.e. (366951), (599135) and (629631) have been awarded Rs30 million each as the second prize.
Whereas 660 prizes of Rs500,000 each to the following numbers of prize bonds:
Please click the link to check the numbers.
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Profit rates on saving schemes sharply increased
ISLAMABAD: The government has announce sharp increase in profit rates for national saving scheme following the significant rise in key policy rate announced last month by the State Bank of Pakistan (SBP).
The Central Directorate of National Savings (CDNS) on Thursday notified increase in profit rates of saving schemes. The CDNS increased the profit rate up to 240 basis points with effect from December 10, 2021.
READ MORE: SBP increases policy rate by 150 basis points to 8.75%
The profit rate on special saving account has been increased by 240 basis points to 10.6 per cent from 8.20 per cent.
The profit rate on regular income certificate has been increased by 204 basis points to 10.8 per cent from 8.76 per cent.
The profit rate on pension and Behbood certificates have been increased by 192 basis points to 12.96 per cent from 11.04 per cent.
The profit rate has been increased by 175 basis points to 7.25 per cent from 5.5 per cent on saving accounts.
Similarly, the profit rate on defence saving certificates has been increased by 161 basis points to 10.98 per cent from 9.37 per cent.
READ MORE: CDNS decides screening all customers of national saving schemes
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National Savings tightens checks on investors
ISLAMABAD: The government has tightened monitoring of investors of national savings to comply with conditions of Financial Action Task Force (FATF) and prevent transactions related to money laundering and terror financing.
The Central Directorate of National Savings (CDNS) has prepared a comprehensive plan to examine the customers and issued instructions to all its regional offices in the country.
The plan has been prepared by the National Savings (AML&CFT) Supervisory Board in consultation with the Financial Monitoring Unit (FMU).
Under the plan the offices of the national savings have been advised to follow the guidelines in examining and monitoring the customs of the saving certificates and prize bonds.
All those customers will be examined where overall investment quantum, account balance or transactional activity is not in line with their businesses, known means or stated purpose of products.
The authorities issued red flags for transactional patterns related to all products, including certificates, accounts and prize bonds.
Following are the red flags to identify suspicious transactions:
· Nominee is not a close relative or change in nominee (for instance, to include non-family members).
· Third party check is provided for investment.
· Purchase of a long-term investment product followed shortly thereafter by a request to liquidate the position to get back the invested amount.
· Overall investment quantum, account balance or transactional activity is not in line with the customer’s business, known means or stated purpose of the product.
· Client is frequently purchasing savings certificates / prize bonds through unusual payments in cash which do not commensurate with his/her profile.
· Unusually high levels of investments or unusually large transactions in relation to what might reasonably be expected of clients with a similar profile.
· When transactions are conducted without any apparent legitimate or economic reason.
· Where multiple deposits are made by unrelated individuals.
· Large cash is deposited followed by early withdrawal.
· Where large deposits and withdrawals are made routinely, and the end of day balance is very low or nil.
· When a customer insists to buy multiple savings certificates/prize bonds through structured/broken cash transactions to avoid CTR reporting threshold (PKR 2.0 Million and above).
· Two or more customers (Linked/associated with each other) working together to break one cash transaction into two or more transactions to evade the CTR reporting requirement.
· Purchase of higher denomination Prize Bonds against cash without providing any plausible justification.
· Encashment of higher denomination Prize Bonds without any plausible justification.
· When a customer is frequently converting one product into another (especially in the name of an unrelated third party) without any plausible justification.
· Numerous prizes are repeatedly/very frequently being claimed by the customer against winning prize bonds during a short span of time.