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BSS
  22 Sep 2021, 16:36

Interest rates cut on savings certificates won't affect marginalized  investors: Kamal

    DHAKA, Sept 22, 2021 (BSS) - Finance Minister AHM Mustafa Kamal today 
said that the recent interest rates cut on savings certificates would not 
affect the small and marginalized investors.

     "With this cut in interest rates, the marginalized people and also those 
who keep small investment in savings certificates won't be affected," he 
said.

     The Finance Minister said this today while replying to a question during 
his briefing after the meetings on Cabinet Committee on Economic Affairs 
(CCEA) and the Cabinet Committee on Government Purchase (CCGP).

     He said usually the savings certificates target the marginalized people 
and also the pensioners, but in recent times the government has noticed that 
all are coming to these savings tools due to the comparatively higher 
interest rates. "If such a trend continues, then the other drivers of the 
economy will become stagnant," he added.

     Kamal said although the interest rates on savings certificates have been 
slashed, but there was no cut on the rates with investment of up to Taka 15 
lakh considering the marginalized section of people. "But, still the interest 
rates of savings certificates are higher than other deposits now prevail in 
market,"

     The new rates will not affect the present investment and will only be 
applicable for fresh investments.

     According to the new rules, which came into effect yesterday, the higher 
the investment amount, the lower the returns will be. If the investment 
amount is higher than Taka 15 lakh, investors will get a lower interest rate, 
according to a circular of the Internal Resources Division (IRD) of the 
Ministry of Finance.

     Asked whether the government wants to discourage people towards savings 
tools, Kamal said the government wants to motivate those sections of people 
to savings tools who actually require those.

     Citing an example, he said that the government does not want anyone to 
invest Taka 1 crore in savings certificates, rather the investment could 
range between Taka 1 lakh to Taka 30 lakh and through this no one would be 
affected.

     The Finance Minister said the recent cut in interest rates has been made 
considering the rates of deposits in other banks, and also the interest of 
the marginal investors.

     He, however, informed that rationalization of the interest rates of the 
savings certificates is an ongoing process and the rates might go up or go 
down.

     In the last fiscal year (FY21), savings certificates worth Taka 112,188 
crore were sold, up 67 percent year-on-year.

     Net sales of the savings certificates were Taka 41,959 crore and its 
growth was 190 percent year-on-year, according to the data of the Directorate 
of National Savings. 

     The government has allocated Taka 62,000 crore for the current fiscal 
year to pay interest on domestic borrowings, up from Taka 58,253 crore in the 
previous budget.

     Asked about the mushrooming of the e-commerce firms, Kamal said that 
such e-commerce firms often appear before the country and people and thus 
tend to cheat with the commoners.

     He said the concerned Ministries, Divisions, and agencies should take 
responsibility to deal with the issue.

     Replying to another question about the progress on the government's move 
to the decentralization process, Kamal said that the government wants people 
to stay where they remain, especially in the rural areas to lessen pressure 
on the capital.

     For this, he said there is necessary to increase manifold the rural 
infrastructures and civic facilities for which the government has been 
working tirelessly.
 

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