The government will review and re-fix soon the yield rates of different national savings certificates aiming to make them time-befitting, officials said.
The finance minister in a letter on Tuesday last asked the senior secretary of the finance ministry to fix the date for holding a meeting in this regard, they added.
"Two meetings will be held. One is on the land price for tax fixation and its collection. Another is on re-fixation of the yield rates of savings instruments. There exists a big mismatch between the yield rates of the tools and ground realities. The date of the meetings will be set within two or three days," the finance minister said in the letter.
The finance minister left Dhaka for Italy on Thursday to attend the 40th session of the governing council of the International Fund for Agricultural Development (IFAD). He will sit in the meeting on re-fixation of the yield rates of savings certificates after he returns home.
"New yield rates of national savings tools will be announced shortly. It is very difficult to say the extent of reduction or increase of rates," a senior official of the finance ministry told the FE.
The decision to review the yield rates of savings tools has been taken to bring down the government's expenditure on interest payment, he said.
Reduction of the yield rates of savings instruments will hit the low and middle-income groups of people hard. They prefer savings certificates to bank deposit schemes due to secure and higher rates of return. Besides, it is a risk-free investment as the government operates the programme, experts said.
Usually women, disabled and retired persons invest in savings certificates. For this, the government keeps yield rates higher. Presently, businesspeople and the rich also invest in different state-owned savings tools, they said.
The current rates of interest on different bank deposit schemes are very low. The weighted average rate of interest on deposits is now 5.13 per cent, the central bank data showed.
Bankers and businessmen have been demanding the reduction of the yield rates of savings tools. The move will discourage the people to invest in the savings certificates if the decision is implemented, a source concerned said.
The Bangladesh Bank (BB) has recently asked the scheduled banks not to reduce the rates of interest on deposits.
The government constituted a committee in 2016 to review and re-fix the yield rates for savings instruments in January and October every year.
The government reduced the yield rates of national savings certificates in May 2015. But the rate of five-year wage earner development bond remained unchanged.
The rates of returns on family savings certificate declined from 13.45 per cent to 11.52 per cent while five-year Bangladesh savings certificate from 13.19 per cent to 11.28 per cent, three-month savings certificate from 12.59 per cent to 11.04 per cent, pensioner savings certificate from 13.19 per cent to 11.76 per cent and post office savings certificate from 13.24 per cent to 11.28 per cent.
The net sales of savings certificates stood at Tk 234.73 billion in the July-December period of the fiscal year (FY) 2016-17 against the target of Tk 196.10 billion set earlier by the finance ministry for the current fiscal year, according to the Department of National Savings (DNS) data.
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