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Govt lowers upper limits on purchase of NSCs

Staff Correspondent      | Published: 22:42, Dec 03,2020

 
 

The government on Thursday set the upper limit on the purchase of three types of national savings certificates at Tk 50 lakh in total under a single name and at Tk 1 crore under joint names to reduce the burden of costly public borrowing and support the country’s banking system in lowering the interest rate.

Previously, people could buy savings certificates — the five-year Bangladesh Sanchayapatra, three-month profit-based Sanchayapatra and Paribar Sanchayapatra — worth Tk 1.05 crore under a single name and worth Tk 1.20 crore under joint names.

The government also set the maximum purchase limit for the three types of savings bonds to Tk 1 crore in total.

It also scrapped the provision of the Commercially Important Person award given to expatriates and non-resident Bangladeshi investors on their investment in the Wage-Earners Development Bond, the US Dollar Premium Bond and the US Dollar Investment Bond.

The NSD introduced the Wage-Earners Development Bond in 1981, the US Dollar Premium Bond in 2002 and US Dollar Investment Bond in 2002 for Bangladeshi expatriates.

The Internal Resources Division of the finance ministry issued three separate Gazette notices in this connection on the day.

The new limits came into effect immediately from the date of issuance of the notices, according to the gazette.

Officials said that the notices were issued based on the government’s decisions taken several months back as part of lowering the interest rates in banks.

The IRD’s National Savings Directorate is preparing fresh guidelines to incorporate the decisions and some other issues introduced to discourage savings certificate sales as those have become costly ways to borrow for the government as well as to bring discipline in the sector.

Earlier, the government made holding an electronic taxpayer’s identification number mandatory for buying savings certificates.

It also barred the buying of savings certificate worth above Tk 1 lakh in cash.

Previously, an investor could buy the Bangladesh Sanchayaparta worth up to Tk 30 lakh, three-month profit-based Sanchayapatra worth up to Tk 30 lakh and Paribar Sanchayapatra worth up to Tk 45 lakh under a single name.

He or she would also be allowed to purchase Bangladesh Sanchayaparta worth up to Tk 60 lakh and three-month profit-based Sanchayapatra worth up to Tk 60 lakh under joint names.

On the other hand, the government would honour expatriate investors with the CIP status for investment worth Tk 8 crore or above in the fiveyear Wage-Earners Development Bond and $1 million each in US Premium Dollar Bond and US Dollar Investment Bond.

According to the NSD, net sales of national savings certificates stood at Tk 15,642.36 crore in the July-October period of the current fiscal year 2020-2021 against the government’s target of Tk 20,000 crore for the entire fiscal year.

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