Net sales of savings certificate drop more than half in April
According to central bank sources, net saving in April was Tk1,525 crore which was Tk3,691 crore in March
Net sales of savings certificate in April fell by more than half compared to that in March this year.
According to central bank sources, net saving in April was Tk1,525 crore which was Tk3,691 crore in March. The sales in February and January were Tk3,690 crore and Tk4,210 crore respectively.
About the decline in sales in April, CPD Senior Research Fellow Taufiqul Islam Khan told The Business Standard, "Many people buy more saving certificates at the end of a financial year – April, May and June – to get income tax rebates. The second wave of Covid-19 may have caused such a decrease in sales in April."
He further said that people had reduced their purchases of savings certificates out of fear that the second wave could lead to another uncertain situation. People want to keep cash to deal with such situations.
Besides, one has to go to a bank or an institution concerned for buying savings certificates. Since the lockdown began in April, many have not taken risks and gone out.
Meanwhile, in the first 10 months of the current financial year, July-April, the net sales of saving certificates were Tk34,728 crore, which is Tk4,426 crore more than the target of the revised budget for the current fiscal.
However, this target was announced at Tk20,000 crore in the main budget of the current financial year. As of July-April, more than Tk14,728 crore worth of savings certificates were sold.
In the budget proposed by the finance minister for the new financial year on 3 June, the government has set a target of borrowing Tk32,000 crore by selling savings certificates to meet the budget deficit.
At present, the average interest rate on bank deposits is 4.5%, while inflation is 5.5%. As such, if the actual interest rate is negative, depositing money in the bank causes loss. On the other hand, the interest rate on various types of saving certificates is between 9.5%-11.5%.