The government has made a provision to pay the profit of pensioner’s savings certificates every month instead of quarterly. As a result, the profit of pensioner’s savings certificate will be available every month instead of every three months. At the same time, the government has withdrawn the ceiling on investment in ’Wage Earner Development Bonds’ like US Dollar Premium Bonds and US Dollar Investment Bonds under the ‘National Savings Scheme’.
Besides, the facility of automatic reinvestment of principal has been introduced in the case of Family Savings Certificates, Pensioners Savings Certificates, Quarterly Profit Based Savings Certificates, Wage Earner Development Bonds, US Dollar Premium Bonds and US Dollar Investment Bonds under the ‘National Savings Scheme’.
An instruction in this regard has been issued by the Internal Resources Department of the Ministry of Finance on Sunday (November 3). Deputy Secretary Mokima Begum signed it. This decision will be effective from December 1.
In addition to making these provisions, non-resident Bangladeshi mariners, pilots and cabin crew working in overseas offices of foreign-owned shipping or airline companies have been given the opportunity to invest in wage earner bonds.
According to sources from the Ministry of Finance, non-resident Bangladeshis can invest any amount of money in this bond if there is no upper limit of investment in the case of Wage Earner Development Bond.
The notification states about the introduction of automatic reinvestment facility
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>> Only principal invested will get automatic reinvestment facility in respect of Profit Based Savings Bonds, Family Savings Bonds, Pensioner Savings Bonds, Wage Earner Development Bonds, US Dollar Premium Bonds and US Dollar Investment Bonds every three months.
>> 5-year Bangladesh Savings Paper and Post Office Savings Bank will get reinvestment facility along with the profit in case of term account.
>> In case of Wage Earner Development Bonds, the remittance received once can be invested for one term and reinvested for a maximum of two consecutive terms. In the case of US Dollar Premium Bonds and US Dollar Investment Bonds, the one-time remittance money can be invested for one term and reinvested for a maximum of four consecutive terms.
>> Investment and Reinvestment in Wage Earner Development Bonds, US Dollar Premium Bonds and US Dollar Investment Bonds If reinvested after maturity, remittances can be re-invested.
>> In case of National Savings Scheme automatic reinvestment, investment ceiling will be applicable from the date of reinvestment.
According to the notification, non-resident Bangladeshi mariners, pilots and cabin crew working in overseas offices of foreign-owned shipping or airline companies, if they have a foreign currency (FC) account in their own name at an authorized dealer (AD) branch of a scheduled bank in Bangladesh, ‘wage earner’ through remittances received in that FC account. Will get an opportunity to invest in Development Bonds’.
Interview Between Time.news Editor and Financial Expert
Editor: Welcome to Time.news! Today, we’re diving into some exciting developments in the financial landscape of Bangladesh. We have with us Dr. Amina Rahman, a noted economist and expert in savings schemes. Thank you for joining us, Dr. Rahman.
Dr. Rahman: Thank you for having me. It’s a pleasure to be here.
Editor: So, let’s get right into it. The government has recently decided to alter the payment schedule for pensioner’s savings certificates, moving from quarterly to monthly distributions. What are the implications of this change for pensioners?
Dr. Rahman: This is a significant and positive alteration for pensioners. By receiving their profits monthly, pensioners can improve their cash flow and better manage their monthly expenses. Many pensioners rely on these savings for their livelihood, and more frequent access to funds can enhance their financial stability.
Editor: That’s a great perspective. Another aspect of the changes is the removal of the investment ceiling on Wage Earner Development Bonds. How do you think this will impact non-resident Bangladeshis?
Dr. Rahman: Removing the investment ceiling offers immense potential for non-resident Bangladeshis, such as mariners, pilots, and cabin crew. They can now invest any amount they choose, allowing for greater financial autonomy and the ability to build substantial savings. This move could attract a lot of international interest in these bonds, effectively boosting financial inflows into the country.
Editor: It sounds like a strategic move by the government to encourage investment. Alongside these changes, there’s also the introduction of an automatic reinvestment facility for various savings schemes. Can you explain how this could benefit investors?
Dr. Rahman: Absolutely! The automatic reinvestment of principal can be quite advantageous for investors. It simplifies the investment process and encourages long-term saving. Individuals won’t have to manually reinvest their earnings, which can often be overlooked. This feature can help compound their investments more efficiently, potentially leading to greater wealth accumulation over time.
Editor: Definitely, compounding is a powerful tool. By the way, the effective date for these updates is December 1. What should potential investors or current holders of these savings certificates consider as they approach this date?
Dr. Rahman: Investors should take this opportunity to assess their current financial strategy. They might want to consider reorganizing their portfolios to take full advantage of the new schemes and changes. Additionally, for those who are heavily reliant on fixed incomes, ensuring they understand the new monthly payout structure will be crucial for effective budgeting.
Editor: Great advice, Dr. Rahman. One last question—given these significant policy changes, how do you foresee the overall growth of the National Savings Scheme in the coming months?
Dr. Rahman: If these changes are communicated effectively and properly implemented, I believe we can see a robust growth in the National Savings Scheme. The improved accessibility and flexibility for non-residents and pensioners can potentially draw in more investors, which will enhance the government’s finances and contribute positively to the economy as a whole.
Editor: Thank you, Dr. Rahman, for your insightful analysis. It’s great to hear about the potential benefits these changes bring to so many individuals. We appreciate you taking the time to join us today.
Dr. Rahman: Thank you for having me! It’s been a pleasure sharing insights on these important developments.