Tag: Prize Bonds

KARACHI: The government has stopped the sale of prize bonds of Rs25,000 denomination with immediate effect and the same shall not be encashed / redeemed after May 31, 2021, State Bank of Pakistan (SBP) said on Thursday.

The SBP said that the finance ministry had already issued instructions in this regard a day earlier. The ministry also announced the issuance of registered or premium prize bonds of Rs25,000 denomination.

The SBP issued following instructions to the president and CEOs of all commercial banks regarding option to replace / encash the bonds:

1. Conversion to Premium Prize Bonds (Registered)

i. The Bonds can be converted to Rs. 25,000/-denomination Premium Prize Bonds (Registered) through the 16 field offices of SBP Banking Services Corporation, and branches of six authorized 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 authorized commercial banks shall also issue Rs. 25,000/-denomination Premium Prize Bonds (Registered)as per the prescribed procedure, with immediate effect. Stock of the same has already been delivered to authorized commercial banks.

iii. The bondholder shall be required to submit a written request for conversion of bearer bonds to Rs. 25,000/-Premium Prize Bonds (Registered) on the prescribed application form.

iv. The bondholder shall also be required to submit prescribed application forms for registration / purchase of Premium Prize Bonds as per the procedure in vogue.

2. Replacement with Special Savings 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 Savings 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 bondholder shall also be required to submit application form for purchase of SSC / DSC (SC-1) as per the prescribed procedure

3. Encashment at Face Value

i. 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, at authorized commercial bank branches and to the Savings Accounts at National Savings Centres.

ii. All commercial banks shall receive requests for encashment of bearer bonds on the prescribed application form.

A copy of the application form (Annexure A), duly signed and stamped, shall be provided to the bondholder as an acknowledgement receipt.

Moreover, the prize bonds encashed / replaced by the general public may be surrendered to the concerned SBP BSC office through the respective regional office of the commercial bank.

For this 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.

It is imperative to mention that a notice regarding the above-mentioned facilities must be displayed at prominent places within branch premises for awareness and information of the general public.

KARACHI: State Bank of Pakistan (SBP) on Tuesday announced extension in date for encashment, replacement and conversion of unregistered Rs40,000 denomination prize bonds.

The SBP said that the date for withdrawal of the prize bonds had been extended up to December 30, 2021.

The central bank said that the Finance Division, Government of Pakistan has extended the last date for encashment / replacement / conversion of Rs. 40,000/- denomination National Prize Bonds (bearer) till December 30, 2021 vide their Notification No. F.16(3)GS-I/2014-1603 dated November 26, 2020.

The branch / region wise consolidated data of Rs. 40,000/- denomination prize bonds held by them on last date i.e. December 30, 2021 shall be shared latest by December 31, 2021, as per the instructions stipulated in Para 4 of CMD Circular No. 4 dated June 30, 2020.

All other instructions in this regard shall remain unchanged.

Kindly disseminate aforementioned instructions to all branches and concerned officials for information and strict compliance, the SBP said.

KARACHI: State Bank of Pakistan (SBP) on Monday directed commercial banks to ensure payment of prize bonds i.e. prize money and face value.

The SBP said that it had observed that commercial banks have not been extending the desired level of support to their customers in availing the facility on payment of prize money and face value of National Prize Bonds through their bank branches.

In view of the above, all authorized commercial banks are advised to ensure compliance to the following instructions:

i. The head office / regional offices of each commercial bank shall reiterate the instructions referred at para. 1 above and advise all the designated branches to extend maximum support to their customers in this regard.

ii. Efforts shall be made to increase the number of designated branches for the subject facility so as to enhance the outreach and ensure adequate geographic coverage.

iii. The information about availability of this facility shall be prominently displayed on the banks’ official website as also in the premises of the designated branches for information of the general public.

iv. Customer service officials shall facilitate / brief customers on the availability of this facility in their respective branches.

KARACHI: People now can surrender Rs40,000 denomination bearer prize bonds by June 30, 2020 and exchange the amount with registered bonds or other given options.

Finance Division on Tuesday issued a notification to extend the last date for encashment/redemption of Rs40,000 bearer bonds from March 31, 2020 to June 30, 2020.

The SBP stopped the issuance of Rs40,000 denomination prize bonds on June 24, 2019 and given deadline of March 31, 2020 for exchange the such denomination with other registered mode of investment.

Since the announcement of the central bank, the holders of bearer bonds had surrendered around Rs238 billion till November 2019.

The total investment Rs40,000 denomination bearer bonds peaked at Rs258 billion by May 2019, which reduced to around Rs20 billion by November 2019.

SBP stops banks selling Rs40,000 prize bonds, issues procedure for conversion into registered bonds

The SBP in a notification issued in June 2019 issued the following instructions regarding handling of Rs.40,000/- denomination National Prize Bonds are issued herewith for information, guidance and meticulous compliance:

a) National Prize Bonds of Rs.40,000/- denomination shall not be sold after June 24, 2019 and will not be encashed/redeemed after March 31, 2020.

b) No further draws of Rs.40,000/-denomination National Prize Bonds shall be held.

c) Cash payment for encashments of bonds is not allowed. However, the bond holder (s) shall have the following options to replace / encash these bonds:

1. Conversion of premium prize bonds (registered)

2. Replacement with special saving certificate (SSC)/Defence Saving Certificate (DSC)

3. Encashment at face value.

d) Appended below is the SOP for processing requests under the aforementioned options for compliance by all banks:

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 (NBP), Habib Bank Limited (HBL), United Bank Limited (UBL), MCB Bank Limited (MCB), Allied Bank Limited (ABL) and Bank Alflah Limited (BAFL).

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.

iii. The bond holder shall also be required to submit prescribed applications forms for registrations / purchase of premium prize bond as per the procedure in vogue.

Replacement with the Special Saving Certificate (SSC)/Defence Saving 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 Savings 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 bondholder shall also be required to submit application form for purchase of SSC/DSC (SC-1) as per the prescribed procedure.

Encashment at Face Value:

i. 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.

ii. All commercial banks shall receive requests for encashment of bearer bonds on the prescribed application form.

A copy of the application form, duly signed and stamped, shall be provided to the bondholder as an acknowledgement receipt.

The SBP said that it is needless to mention that the National Prize Bonds of Rs40,000 denomination tendered at the counters of banks shall be subject to through scrutiny to ascertain their genuineness. In this regard, details regarding the security features in Rs40,000 denomination National Prize Bonds are available online.

Moreover, the prize bonds encashed / replaced by general public may be surrendered to concerned SBP BSC office through respective regional office of the commercial banks. 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.

It is imperative to mention that a notice regarding the above / mentioned facilities must be displayed at prominent places within branch premises for awareness and information of general public.

KARACHI: People can surrender Rs40,000 denomination bearer prize bonds by March 31, 2020 and exchange the amount with registered bonds or other given options.

The SBP stopped the issuance of Rs40,000 denomination prize bonds on June 24, 2019 and given deadline of March 31, 2020 for exchange the such denomination with other registered mode of investment.

Since the announcement of the central bank, the holders of bearer bonds had surrendered around Rs238 billion till November 2019.

The total investment Rs40,000 denomination bearer bonds peaked at Rs258 billion by May 2019, which reduced to around Rs20 billion by November 2019.

SBP stops banks selling Rs40,000 prize bonds, issues procedure for conversion into registered bonds

The SBP in a notification issued in June 2019 issued the following instructions regarding handling of Rs.40,000/- denomination National Prize Bonds are issued herewith for information, guidance and meticulous compliance:

a) National Prize Bonds of Rs.40,000/- denomination shall not be sold after June 24, 2019 and will not be encashed/redeemed after March 31, 2020.

b) No further draws of Rs.40,000/-denomination National Prize Bonds shall be held.

c) Cash payment for encashments of bonds is not allowed. However, the bond holder (s) shall have the following options to replace / encash these bonds:

1. Conversion of premium prize bonds (registered)

2. Replacement with special saving certificate (SSC)/Defence Saving Certificate (DSC)

3. Encashment at face value.

d) Appended below is the SOP for processing requests under the aforementioned options for compliance by all banks:

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 (NBP), Habib Bank Limited (HBL), United Bank Limited (UBL), MCB Bank Limited (MCB), Allied Bank Limited (ABL) and Bank Alflah Limited (BAFL).

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.

iii. The bond holder shall also be required to submit prescribed applications forms for registrations / purchase of premium prize bond as per the procedure in vogue.

Replacement with the Special Saving Certificate (SSC)/Defence Saving 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 Savings 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 bondholder shall also be required to submit application form for purchase of SSC/DSC (SC-1) as per the prescribed procedure.

Encashment at Face Value:

i. 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.

ii. All commercial banks shall receive requests for encashment of bearer bonds on the prescribed application form.

A copy of the application form, duly signed and stamped, shall be provided to the bondholder as an acknowledgement receipt.

The SBP said that it is needless to mention that the National Prize Bonds of Rs40,000 denomination tendered at the counters of banks shall be subject to through scrutiny to ascertain their genuineness. In this regard, details regarding the security features in Rs40,000 denomination National Prize Bonds are available online.

Moreover, the prize bonds encashed / replaced by general public may be surrendered to concerned SBP BSC office through respective regional office of the commercial banks. 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.

It is imperative to mention that a notice regarding the above / mentioned facilities must be displayed at prominent places within branch premises for awareness and information of general public.

KARACHI: The investment in premium prize bonds of Rs40,000 denomination has sharply increased by 156 percent to Rs14.84 billion by August 2019 as compared with Rs5.78 billion in the same month of the last year.

The significant increase in registered prize bonds of Rs40,000 denomination has been attributed to the announcement of the government to seize the issuance of unregistered instrument to stop expansion of black economy.

In February this year the central bank stopped the issuance of Rs40,000 denomination prize bonds from its offices. The SBP also advised the Central Directorate of National Savings (CDNS) to stop printing the unregistered Rs40,000 prize bonds.

A member of Tax Reform Committee (TRC), which was constituted by the former government in 2014 said that it was recommendation of the TRC to stop the circulation of high denomination prize bonds.

The member said that the committee had presented its report in May 2015 and advised the then finance minister the high denomination prize bonds were major source for expansion of black economy.

The TRC had recommended to document high denomination prize bonds of Rs25,000 and Rs40,000 and should be issued against CNICs of individuals.

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

In compliance to the government announcement the SBP also issued instructions to banks. The central bank issued procedure for the banks to facilitate general public in exchanging the unregistered prize bonds with three different modes.

The SBP said that the bearer prize bonds of Rs40,000 cannot be exchanged against cash. However, it can be redeemed against registered prize bonds or can be converted into national saving schemes or face value (direct transfer to the bank account of bond bolder).

The SBP informed the banks that such prize bonds would not be sold after June 24, 2019 and will not be encashed/redeemed after March 31, 2020. No further draws of Rs40,000 denomination national prize bonds shall be held.

The government is intending to expand the documented prize bonds in other denomination as well on the recommendations of the TRC, the member said.

The TRC in its report pointed out: “Issuance of prize bond of Rs 25,000 or Rs 40,000 should be discontinued as these high denomination bearer instruments fuel corruption and tax evasion.”