NSC sales stay in the red despite slowing outflows

Experts say the future trajectory of NSC sales depends on interest rate movements, inflation trends, and government's borrowing strategy

SAJIBUR RAHMAN | Published: April 18, 2026 22:51:15

Investment in National Savings Certificates (NSCs) continues to remain under pressure, with persistent net withdrawals reflecting weakening investor appetite despite brief signs of recovery.
Net sales of savings certificates remained on a negative trajectory in early 2026, indicating continued outflows from the instrument.
In February 2026, net sales stood at Tk11.65 billion in deficit, following a deeper deficit of Tk 18.51 billion in January.
The trend highlights sustained withdrawals over the past year.
A similar pattern was observed in the corresponding period of the previous year, when net sales in February 2025 recorded a deficit of Tk 17.58 billion, suggesting that the decline is part of a broader structural shift rather than a temporary fluctuation.Net sales of savings certificates are calculated by deducting repayments against earlier investments from fresh sales.
Sharp Improvement in FY26, But Still in Deficit
Cumulatively, the July-February period of FY26 shows a significant improvement compared to the previous fiscal year, although the overall position remains in deficit.
Net sales during July-February FY25 recorded a deficit of Tk 87.71 billion, which narrowed sharply to Tk 5.55 billion in FY26. This suggests that outflows have slowed, even though the instruments have not yet returned to positive growth.
Outstanding Stock Rises
The total outstanding balance of savings instruments also rose. As of February 2026, the stock stood at Tk 3.42 trillion, up from nearly Tk 3.37 trillion a year earlier, despite continued net withdrawal.
Annual Deficit Narrows
On a yearly basis, the deficit in NSC sales has reduced significantly. In FY25, net sales showed a deficit of Tk 60.63 billion, compared to a much larger deficit of Tk 211.24 billion in FY24.
This indicates stabilisation, although the sector remains under pressure.
Policy and Market Factors
Market insiders attribute the continued weakness largely to policy tightening and shifting financial conditions.
The introduction of the National Savings Certificates Online Management System in 2019, which requires e-TIN and National ID verification, has reduced participation from institutional and high-value investors.
At the same time, rising interest rates in the banking sector have made deposits more attractive, while inflation has eroded real returns from fixed-income savings instruments.
Experts say the future trajectory of NSC sales will depend on interest rate movements, inflation trends, and the government's borrowing strategy.
Without significant policy or market adjustments, demand for savings instruments may remain subdued in the near term, they added.
Dr Masrur Reaz, chairman, Policy Exchange Bangladesh, said, "The continued negative net sales of national savings certificates reflect a structural shift rather than a temporary dip. Tighter compliance and more attractive bank interest rates are diverting funds away from NSCs, while inflation is also influencing investor choices".
Although the deficit has narrowed in FY26, persistent negative sales show demand remains weak, he said.
Going forward, the government needs to balance its borrowing strategy and focus on developing a stronger bond market to reduce reliance on NSCs, Dr Reaz added.
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