KARACHI
\nThe government has sharply reduced returns on savings accounts by up to 360 basis points, further challenging small investors.
\nProfit rates for National Savings Schemes (NSS) have been revised across all categories, with only slight reductions for pensioners, Shuhada and Bahbood scheme for widows.
\nThe NSS, launched in 1966 to attract investments, initially saw strong participation, but its appeal shifted when corporate entities began leveraging these schemes for risk-free returns. Corpor\u00adate investments were subsequently banned in July 2020 to protect small investors, leading to a significant decline in total NSS investment volumes.
\nThe biggest cut affects Special Savings Certifi\u00adcates (SSC), where returns have dropped to 11.60 per cent from 15.20pc \u2014 a 360 basis point decline.
\nSpecial Savings Accounts (SSA) were also hit, with returns down by 220 basis points, now offering 13pc instead of 15.20pc. Regular Income Certificates (RIC) saw a smaller cut of 60 basis points, bringing returns to 12.12pc.
\nIslamic accounts were also impacted, with profits on the Sarwa Islamic Savings Account (SISA) and Sarwa Islamic Term Account each reduced by 309 basis points to 11.16pc from 14.25pc.
\nMeanwhile, returns on welfare-focused accounts, such as the Shuhadas Family Welfare Account, Pensioners\u2019 Benefit Account and Bahbood Savings Certificates, saw minor reductions of 24 basis points each, now offering 13.92pc.
\nThese cuts were largely anticipated in the financial market due to the State Bank\u2019s recent interest rate reductions. Since June 2024, the State Bank has lowered the interest rate by 450 basis points to 17.5pc, with another potential cut expected in the next monetary policy announcement on Nov 4.
\nThe new NSS profit rates will also take effect from Nov 4. NSS investments in July and August this year totalled Rs18.4 billion and Rs5.82 billion, respectively.<\/p>\n","protected":false},"excerpt":{"rendered":"
KARACHI The government has sharply reduced returns on savings accounts by up to 360 basis points, further challenging small investors. Profit rates for National Savings Schemes (NSS) have been revised across all categories, with only slight reductions for pensioners, Shuhada and Bahbood scheme for widows. The NSS, launched in 1966 to attract investments, initially saw […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[],"class_list":{"0":"post-441277","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-business"},"yoast_head":"\n