The net sales of savings certificates have registered an around four-time rise year-on-year in the first six months of the fiscal 2020-21, exceeding the target fixed for the whole fiscal year.
In July-December, the net sales of savings instruments increased to Tk20,487 crore in contrast to only Tk5,433 crore over the same period a year ago, the central bank's data released on Thursday shows.
Asked about the big jump despite people's income erosion amid the pandemic, Dr Ahsan H Mansur, executive director of the Policy Research Institute, told The Business Standard, "Maybe, those whose incomes have declined are not buying savings instruments. Apart from them, many people have enough incomes to buy the instruments."
The interest rate on savings certificates is three times higher than that on bank deposits. Savers now prefer it as a safe and good investment medium, he added.
In December last year, the government set a ceiling for investments in three different types of national savings certificates at Tk50 lakh in total under a single name and at Tk1 crore under joint names.
The types are the five-year Bangladesh Sanchayapatra, three-month profit-based Sanchayapatra and Paribar Sanchayapatra.
Ahsan H Mansur said many people purchased savings certificates just after coming to know about the government's plan to lower the upper limits on investments in savings tools.
Therefore, sales of savings certificates increased significantly in July-December 2020, he opined.
He said the sales might drop a bit in the coming days because of the cap on the purchase.
To meet the budget deficit, the government's target to collect Tk20,000 crore through the sales of savings certificates for the ongoing fiscal year has also been surpassed in the first six months.
Ahsan H Mansur said the sales might reach Tk35,000 crore by the end of the current fiscal year.
With no better alternative available, savers will still try to invest in savings certificates despite the limits on buying those. Those who cannot will go and buy land and houses.
He opined that an economic bubble might be created in the real estate sector as a result of it.
Noting that selling more savings certificates than the target will increase the government's interest expenses, the economist said the government will have to cut the development budget to meet the cost, which can impact new employment generation.
If the government's development expenditure increases, it plays a role in creating new employment. In the same way, a cut in development costs may also slow down the pace of implementation of the ongoing projects.
In the first six months of the current fiscal year, the government has paid about Tk34,000 crore in principal and profit to savings certificate holders, up by over 20% from the same period last year.