Pkrevenue.com

Tag: Central Directorate of National Savings

  • What is last date for redemption of Rs40,000 prize bonds

    What is last date for redemption of Rs40,000 prize bonds

    ISLAMABAD: Regulators are at odds over the last date for conversion/redemption of Rs40,000 denomination national prize bonds, which created distress amongst the prize bondholders.

    A public notice was issued by the Central Directorate of National Savings (CDNS) in February 2021, that the government had discontinued the sale of National Prize Bonds (Bearer) of Rs25,000 and Rs40,000. “The deadline for redemption/encashment of these bonds is May 31, 2021.

    On the other hand, the State Bank of Pakistan (SBP) through its CMD Circular No. 07 dated December 08, 2020, stated: “the finance division, the government of Pakistan has extended the last date for encashment/replacement / conversion of Rs40,000 denomination National Prize Bonds (Bearer) till December 30, 2021, vide their Notification No. F.16(3)GS-1/2014-1603 dated November 26, 2020.”

    The finance division issued notification for withdrawal of Rs25,000 denomination national prize bonds from circulation in December 2020.

    Another SBP CMD Circular No. 08 dated December 10, 2020, stated: “National Prize Bonds of Rs25,000 denomination shall not be sold with immediate effect and will not be encashed/redeemed after May 31, 2021.”

    The public notice issued by the National Savings warned the holders who have not encashed their bonds so far, to redeem/encash Rs25,000 and Rs40,000 prize bonds before the deadline of May 31, 2021, using the following options:

    — Replace with Rs25,000 & Rs40,000 Premium prize bonds (registered)

    — replace with special saving certificates (SSC) / Defence Saving Certificate (DSC)

    — Encashment through Bank Account

    “After the deadline no such bonds will be redeemed/encashed,” it said.

    Sale of Prize Bonds Rs7,500, Rs15,000 stopped forthwith
  • National Savings raises profit rates

    National Savings raises profit rates

    ISLAMABAD: The Central Directorate of National Savings (CDNS) on Thursday raised profit rates of saving schemes.

    A statement issued by the CDNS stated that all the profit rates of bearer certificates had been increased.

    However, profit rates of registered saving certificates have been reduced.

    As per the decision of the CDNS the profit rates have been increased as: Behbood Saving Certificates, Pensioner Benefit Accounts and Shuhda Family Welfare Account from 9.84 percent to 9.96 percent; Defence Saving Certificates from 8.05 percent to 8.11 percent; Regular Income Certificates from 7.44 percent to 7.608 percent.

    The CDNS reduced the average profit rate of special saving certificates (registered)/accounts to 7.05 percent from 7.15 percent.

    Similarly, short term savings certificates for 3-, 6- and 12-month have been reduced to 6.80 percent, 6.76 percent and 6.66 percent from 7.72 percent, 7.36 percent and 7.30 percent respectively.

  • Interest rates on saving certificates slashed up to 100 basis points

    Interest rates on saving certificates slashed up to 100 basis points

    ISLAMABAD: The profit rate on saving certificates have been reduced up to 100 basis points due to sharp cut in key policy rate by the State Bank of Pakistan (SBP). The new rate of return on national saving certificates are applicable from June 02, 2020.

    According to Central Directorate of National Savings (CDNS), the interest rate by one percent on the savings certificates investment due to lower rates of Pakistan Investment Bonds (PIB) applicable from June 02, 2020.

    “The CDNS interest rates are linked with the policy of Pakistan Investment Bonds (PIBs), set the SBP,” an official of CDNS told state-run media.

    The rate of return on ‘Behbood Savings Certificates’ (BSC) reduced from 10.32 to 9.84 percent and as similarly Pensioner Benefit Accounts (PBA) recorded downwards from 10.32 to 9.84 percent.

    The profit rates on ‘Shuhada Family Welfare Account’ also reduced from 10.32 to new rates of 9.84 percent applicable from June 02 of this year.

    The profit rates on ‘Defense Savings Certificates’ (DSC) was also reduced from 8.54 to 8.05 percent and interest rates on ‘Regular Income Certificates’ also downwards 8.28 to 7.44 percent according to the current market situation.

    The profit rates on Special Savings Certificates (Registered)/Accounts was also reduced on all three categories of certificates from 1-5 Profit 8.00 to 7.10 percent, 6th Profit 8.60 percent 7.40 percent and Average 8.10 to 7.15 percent by June 02, 2020.

    The Short Term Savings Certificates profit rates also reduced on different categories on months on month bases by 3- Months from 7.80 to 7.72 , on 6- Months certificates 7.50 to 7.36 percent and on 12-Months slightly increased from 6.95 to 7.30 percent.

    The profit rates on Savings Account (SA) has also been reduced from 7.00 to 6.50 percent decided by last meeting held in Ministry of Finance.

  • Biometric verification of all saving scheme investors to be conducted under FATF recommendations

    Biometric verification of all saving scheme investors to be conducted under FATF recommendations

    ISLAMABAD: The government will conduct biometric verification of all investors of National Saving Schemes in order to make compliance with recommendations of Financial Action Task Force (FATF), a statement issued by Finance Division said on Saturday.

    Asia Pacific Group in its recently published Mutual Evaluation Report (MER 2019), has pointed out number of deficiencies on the part of Central Directorate of National Savings (CDNS) in terms of compliance to FATF recommendations, which has negatively affected the overall grading of different recommendations specially the recommendation 10, 11, 12 and 15.

    In this context, CDNS is committed to mitigating the deficiency to improve customer service delivery and to comply the FATF recommendation to safeguard the interest of the investors, it said.

    Banks under the supervision of SBP have already put in place all the required systems and KYC processes to comply the FATF recommendation.

    Finance Division through promulgation of National Savings Schemes (AML-CFT) Rules, 2019 has decided to engage an AML-CFT compliant bank, through competitive bidding, to put in place the requirement as well as the necessary training of employees of Central Directorate of National Savings (CDNS).

    Accordingly, Expression of Interest, in consultation with SBP, has been sought from the interested bank to conduct KYC (Know Your Customer) and other requirement of new as well as existing client of CDNS.

    This will include the biometric verification and screening of potential clients in UN Proscribed Person List.

    All these screenings are meant to stop any ill-gotten money to become part of financial system and to safeguard the valued investor from the menace of Money Laundering and Terrorist Financing.

    Central Directorate of National Savings (CDNS) as it stands today is one of the longstanding institutions in the country with a legacy of more than 140 years.

    The institution has always been a symbol of unshakable trust of the public.

    National Savings is playing its pivotal role to inculcate the Culture of Savings, facilitate Financial Inclusion and extending Social Security Net to the deserving sections of the society.

    Around 33 percent of CDNS deposits are in Welfare Schemes which attribute around 2 percent incremental rate of profit over and above other regular savings schemes.

    Currently, CDNS manages portfolio of Rs. 4,038 billion (November 2019) of more than 7 million investors.

    National Savings Schemes (“NSS”) provide risk free and competitive avenue to all segments of society specially the most vulnerable i.e. senior citizens, pensioners, widows, physically challenged persons and family members of Shuhada.

    On the other hand, it provides a non-inflationary and cost effective borrowing to the government to bridge the overall fiscal deficit which ultimately reduces dependency on external borrowing.

    About 19 percent of domestic debt consists of NSS while these deposits are equal to 28 percent of total deposit of scheduled bank.

    One of the main challenges to CDNS was its manual operations and lack IT, therefore, CDNS has started its journey of automation in 2009 and successfully completed PSDP funded Automation Project Phase I & II in 2013 and 2017.

    Through these project 223 National Savings Centre (“NSC”) i.e. (60 percent out of total 376) have been successfully automated.

    Automation of remaining 153 is in active process with support of Department for International Development (DFID), UK.

    Meanwhile, CDNS has upgraded its core business solution from decentralized to centralized architecture.

    Around 144 branches have already been shifted to upgraded solution where customer transaction time has significantly reduced.

    Also, the provision of Alternate Delivery Channels (ATM) is in final stages which will further improve the service delivery. Introduction of technology has provided CDNS the opportunity to modernize its process which include swift data reporting, reconciliation with other departments, budgeting and forecasting, customer data base etc.

    Due to IT progress CDNS is now capable to implement number of initiatives which was not possible due to manual operation.

  • Law drafted to examine national saving schemes investments for money laundering, terror financing

    Law drafted to examine national saving schemes investments for money laundering, terror financing

    ISLAMABAD: The government has draft law to examine involvement of money laundering and terror financing in investment made in national saving schemes.

    The ministry of finance on Thursday issued draft rules namely National Saving Schemes (AML and CFT) Rules, 2019.

    Under the draft rules, the Central Directorate of National Savings (CDNS) would conduct customers due diligence (CDD) of all the customers / investors.

    “Every customer, whether permanent or occasional and whether natural or legal person or legal arrangement, shall be identified for establishing business relationship and for the purpose following information shall be obtained, verified using reliable, independent source documents, data or information and recorded namely: –

    (a) full name as per identity or registration documents;
    (b) national identity card, passport, national identity card for overseas pakistanis, Pakistan origin card or alien registration card number, etc.
    (c) registration or incorporation number of business, if applicable;

    (d) residential address, telephone numbers and e-mail, if available;

    (e) business address, telephone numbers and e-mail, if available;

    (f) date of birth;

    (g) date and place of registration or incorporation of business, if applicable;

    (h) nationality

    (i) place of birth;

    (j) national tax number (NTN), if applicable;

    (k) nature of business and location, if applicable;

    (l) sources of earnings;

    (m) customer’s net worth in respect of legal persons, legal arrangements and high risk customers; and

    (n) annual income

    The minimum set of documents to be obtained by the office of issue or third party in case of each category of customers shall be as follows:-

    (a) In respect of individuals, a photocopy of any one of the following valid identity documents namely:-

    (i) computerized national identity card (CNIC) issued by NADRA; or

    (ii) national identity card for overseas Pakistani (NICOP) issued by NADRA; or

    (iii) Pakistan origin card (POC) issued by NADRA; or

    (iv) alien registration card (ARC) issued by NADRA; or

    (v) passport having valid visa on it or any other proof of legal stay along with passport in respect of foreign national individuals only.

    (b) In respect of limited corporations and companies.-

    (i) certified copies of-

    (A) resolution of board of directors for opening of account specifying the persons authorized to open and operate the account (not applicable for single member company);

    (B) memorandum of association;

    (C) articles of association, wherever applicable;

    (D) certificate of incorporation;
    (E) Securities and Exchange Commission of Pakistan (SECP) registered declaration for commencement of business as required under the Companies Act, 2017 (XIX of 2017); and

    (F) list of directors required to be filed under the Companies Act, 2017 (XIX of 2017), as applicable;

    (ii). photocopies of identity documents as per sub-clause (b) of all the ` directors and persons authorized to open and operate the account;

    (c) In respect of trust clubs, societies and associations, etc.-

    (i) Certified copies of-

    (A) certificate of registration or instrument of trust; and

    (B) by-laws, rules and regulations;

    (ii) resolution of the governing body, board of trustees or executive committee, if it is ultimate governing body, for opening of account authorizing the person to operate the account;

    (iii). photocopy of identity document as per sub-clause (i) of clause (c) of the following:

    (A) authorized persons;

    (B) members of governing body, board of trustees or executive committee, if it is ultimate governing body; and

    (C) settlor, the trustees, the protector if any, the beneficiaries or class of beneficiaries

    (d) In respect of NGOs, NPOs and charities,-

    (i) certified copies of –

    (A) registration documents and certificates; and

    (B) by-laws, rules and regulations;

    (ii) resolution of the governing body, board of trustees or executive committee, if it is ultimate governing body, for opening of account authorizing the persons to operate the account;

    (iii) photocopy of identity document as per sub clause (i) of clause (d) above of the authorized persons and of the members of governing body, board of trustees or executive committee, if it is ultimate governing body; and

    (iv) any other documents as deemed necessary including its annual accounts and financial statements or disclosures in any form which may help to ascertain the detail of its activities, sources and usage of funds in order to assess the risk profile of the prospective customer;

    (e) In respect of minor accounts,-

    (i) photocopy of Form-B or birth certificate of the minor; and

    (ii) photocopy of identity document as per sub-clause (i) above of the guardian of the minor;

    (f) In respect of government institutions and entities not covered herein above.-

    (i) CNICs of the authorized persons; and

    (ii) letter of authorization from the concerned authority.

    the office of issue or third party shall verify identity documents of the customers from relevant authorities and bodies, including through NADRA’s verification system or biometric identification system and, where necessary, use other reliable, independent sources and retain copies of all reference documents used for identification and verification.
    The office of issue or third party shall be responsible for verification of the identity documents and the customer shall neither be obligated nor the cost of verification be charged to the customer.

    Where the customer is represented by an authorized agent or representative, or where customer is a legal person, the Office of issue or third party shall identify the natural persons who act on behalf of the customer and verify the identity of such persons and the authority of such natural persons shall be verified through documentary evidence, including specimen signature of the persons so authorized.

    Where beneficial owner is different from the customer, the office of issue or third party shall identify and take reasonable measures to verify identity of the beneficial owners using relevant information or data obtained from a reliable source, to the satisfaction of the office of issue.

    The verification of the identity of customers and beneficial owners, if any, shall be completed before business relations are established.

    The office of issue shall conduct ongoing due diligence on the business relationship, including;-

    (a) scrutinizing transactions undertaken throughout the course of that relationship to ensure that the transactions being conducted are consistent with the office of issue’s knowledge of the customer, their business and risk profile, including where necessary, the source of funds; and

    (b) ensuring that documents, data or information collected under the CDD process is kept up-to-date and relevant, by undertaking reviews of existing records, particularly for higher risk categories of customers.

    The office of issue or third party shall maintain a list of all such customers and accounts where the business relationship needed to be closed on account of negative verification that includes all type of customer identity verification such as NADRA, UNSCR or any other document or information etc.

  • CDNS decides screening all customers of national saving schemes

    CDNS decides screening all customers of national saving schemes

    The Central Directorate of National Savings (CDNS) has decided to screen all customers of national savings schemes.

    (more…)
  • Bearer prize bonds of Rs40,000 worth Rs233 billion documented

    Bearer prize bonds of Rs40,000 worth Rs233 billion documented

    KARACHI: People have documented an amount of Rs233 billion invested in bearer prize bonds of Rs40,000 denominations following the government announcement of discontinuation.

    According to statistics of Central Directorate of National Savings (CDNS) people have Rs323 billion bearer bonds of Rs40,000 denomination by October 2019, which is around 90 percent of the total invested amount till May 2019.

    The government on June 24, 2019 announced to discontinue the circulation of Rs40,000 denomination national prize bonds in initial phase.

    The investment in prize bonds of Rs40,000 denominations reached to record level of Rs258.72 billion by May 2019.

    However, since announcement the stock of bearer prize bonds was gradually falling and reduced to only Rs26.15 billion by October 2019.

    The State Bank of Pakistan (SBP) following the announcement issued procedure for the banks to facilitate general public in exchanging the unregistered prize bonds through three different modes.

    The SBP has barred the exchange of bearer prize bonds against cash.

    However, it can be redeemed against registered or premium prize bonds or can be converted into national saving schemes or face value (direct transfer to the bank account of bond bolder).

    The bearer instruments have been known as parking lot for undocumented economy. Therefore, the government launched registered prize bonds of Rs40,000 denomination in March 2017 which could be purchased against certain requirements including Computerized National Identity Card (CNIC) and valid bank account.

    Following the ban on bearer prize bonds and its conversion through option of known documented manner, the investment in premium prize bonds of Rs40,000 denomination jumped up to Rs17 billion by October 2019 as compared with Rs6.17 billion as of May 2019, showing an increase of 175 percent.

    According to the SBP the bearer instrument can also be exchanged in savings schemes such as Special Saving Certificates (SSC) or Defence Saving Certificates (DSC).

    The total investment into the saving certificates increased to Rs2.4 trillion by October 2019 as compared with Rs2.2 trillion by May 2019.

    The government is intended to transform all the bearer prize bonds into to registered securities. In this regard the Central Directorate of National Savings in collaboration with SBP is planning to issue scripless registered prize bonds amongst all denominations with objective to document the economy.

  • Investment in premium prize bonds surges by 157 percent

    Investment in premium prize bonds surges by 157 percent

    KARACHI: The investment in premium prize bonds of Rs40,000 denomination has witnessed unprecedented growth of 157 percent after the government announcement to discontinue bearer prize bonds of same denomination.

    According to official documents, the investment in premium prize bonds of Rs40,000 denomination surged by 157 percent to Rs15.86 billion by September 2019 as compared with Rs6.17 billion as of May 2019.

    The government on June 24, 2019 announced to discontinue the circulation of Rs40,000 denomination bearer prize bond.

    After the decision of the government people have surrendered Rs222 billion bearer bonds of Rs40,000 denomination by September 2019, which is around 86 percent of the total invested amount till May 2019.

    The State Bank of Pakistan (SBP) following the announcement issued procedure for the banks to facilitate general public in exchanging the unregistered prize bonds through three different modes.

    The SBP has barred the exchange of bearer prize bonds against cash.

    However, it can be redeemed against registered or premium prize bonds or can be converted into national saving schemes or face value (direct transfer to the bank account of bond bolder).

    The bearer instruments have been known as parking lot for undocumented economy. Therefore, the government launched registered prize bonds of Rs40,000 denomination in March 2017 which could be purchased against certain requirements including Computerized National Identity Card (CNIC) and valid bank account.

    According to the SBP the bearer instrument can also be exchanged in savings schemes such as Special Saving Certificates (SSC) or Defence Saving Certificates (DSC).

    The total investment into the saving certificates increased to Rs2.317 trillion by September 2019 as compared with Rs2.2 trillion by May 2019.

    The government is intended to transform all the bearer prize bonds into to registered securities. In this regard the Central Directorate of National Savings in collaboration with SBP is planning to issue scripless registered prize bonds amongst all denominations with objective to document the economy.

  • Profit rates on saving schemes reduced

    Profit rates on saving schemes reduced

    KARACHI: The government has reduced the profit rates on saving certificates effect from November 01, 2019.

    According to notifications issued by Central Directorate of National Savings (CDNS) on Tuesday, the profit rate on Defence Saving Certificate reduced by 2.33 percent to 10.68 percent.

    The profit rate on Pension Behbood has been slashed by 2.28 percent to 12.48 percent.

    The profit rate on Regular Income Certificate has been cut by 2.04 percent to 10.92 percent.

    Similarly, the profit rate on Special Saving Certificate has been cut by 1.70 percent to 11 percent.

    The profit rate on saving accounts has been slashed by 2.05 percent to 8.20 percent.

    Khurram Schehzad, CEO, Alpha Beta Core said that the reduction in profit rate had been done in line with declining secondary market yields on bonds.

    “Decline in fixed income profit rates is going to be positive for equities/stock market,” he added.

  • Investment into premium prize bonds post 46pc growth

    Investment into premium prize bonds post 46pc growth

    KARACHI: The investment in premium prize bonds of Rs40,000 denomination has increased by over 46 percent as the government stopped the circulation of bearer bonds of same denomination and launched campaign to document the economy.

    According to statistics released by State Bank of Pakistan (SBP) the total investment into premium prize bonds of Rs40,000 denomination increased to Rs7.665 billion by end of June 2019 as compared with Rs5.245 billion in same month of the last year.

    The premium prize bonds were launched by the government in March 2019 with the aim to bring undocumented money into the mainstream economy.

    According to salient features of the premium bonds issued by Central Directorate of National Savings (CDNS):

    — The bond is available in Rs40,000 denomination

    — Registered in the name of investor.

    — Quarterly prize money draws as well as bi-annual profit payment.

    — For individuals, public and private sector institutions except banks, insurance companies and mutual funds.

    — Direct credit and prize money and profit in investors bank account.

    — No Application Forms required for claiming prize money & profit.

    — Unlimited Investment and Tenure.

    — WHT applicable and Exempt from Zakat.

    — Transferable and Pledge-able.

    — Can be purchased through Cash, Cheque, Pay-Order and Bank Draft

    — Can be purchased from offices of State Bank of Pakistan Banking Services Corporations.

    The growth in premium prize bonds investment is much faster in the month of June 2019 as compared with the previous month due to the government announcement to stop the circulation of bearer bonds of Rs40,000 denomination.

    The investment in Rs40,000 prize bonds denomination grew by 24 percent to Rs7.665 billion in June 2019 as compared with Rs6.17 billion in May 2019.

    The government on June 24, 2019 notified withdrawal of Rs40,000 denomination national prize bonds from circulation.

    On the same date the State Bank of Pakistan (SBP) issued instructions to chief executives and banks of all banks for compliance.

    The SBP instructed:

    (a) National Prize Bonds of Rs40,000 denomination shall not be sold after June 24, 2019 and will not be encashed/redeemed after March 31, 2020.

    (b) No further draws of Rs40,000 denomination national prize bonds shall be held.

    (c) Cash payment for encashment of bonds is ‘Not’ allowed. However, the bond holder(s) shall have the following options to replace/encash the bonds:

    1. Conversion of Premium Prize Bonds (Registered)

    2. Replacement with Special Saving Certificate (SSC)/Defence Savings Certificate (DSC)

    3. Encashment at Face Value.

    The SBP also issued Standard Operating Procedure (SOP) for conversion to premium prize bonds (registered).

    i. The bonds can be converted to premium prize bonds (registered) through the 16 field offices of SBP Banking Services Corporation, and authorized 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.

    ii. The bond holder shall be required to submit a written request for conversion of bearer bonds to premium prize bonds (registered) to be registered in his/her name on the prescribed application form.

    iii. The bond holder shall also be required to submit prescribed application form for registration/purchase of premium prize bonds as per the procedure in vogue.

    The SBP also issued procedure for replacement with Special Saving Certificate (SSC)/Defence Savings Certificate (DSC).

    i. The bonds can be replaced with SSC/DSC through the 16 field offices of SBP Banking Services Corporation, authorized commercial banks and National Saving Centers.

    ii. All authorized commercial banks shall therefore, accept requests for replacement of bearer bonds with SSC or DSC on the prescribed application form.

    iii. The bond holder shall also be required to submit application form for purchase of SSC/DSC as per the prescribed procedure.

    The SBP issued procedure for encashment at face value and said that the bonds will only be encashed by transferring the proceeds to the bond holder’s bank account through the 16 field offices of SBP banking services corporation as well as the authorized commercial bank branches.

    The SBP further said that all commercial banks shall receive request for encashment of bearer bonds on the prescribed application form.

    The SBP said that the prize bonds encashed/replaced by general public may be surrendered to concerned SBP BSC office through respective regional office of the commercial bank. For the purpose, the regional office may intimate the SBP BSC office three days in advance so that necessary arrangements for receipt of the bonds can be made.

    Related Posts

    Investment in saving certificates rises by 19 percent to Rs2,217 billion