Net government borrowing from publicly funded savings instruments fell in October compared to the September count mainly due to sharp declines in rates of return.

This led the government to borrow larger amounts from the banking system.

Statistics from the Directorate of National Savings (DNS) show net sales of cash certificates at Tk 28.25 billion in September while they fell to Tk 7.66 billion in October.

With the decline in sales of savings instruments, they fell by more than 57% in the first four months of the current financial year (FY) 2021-2022 compared to the level of the corresponding period of the financial year. previous.

Officials attribute such a drastic drop to the recent reduction in rates of return on savings instruments by the government.

Up to 2.0% of returns were reduced on almost all savings plans on September 21.

According to the circular, issued by the Internal Resources Division (IRD), savers will receive old rates of return up to Tk 1.5 million on their investment in different savings plans. The prices on those already open will also remain unchanged.

Net sales of savings plans amounted to Tk 93.24 billion during the July-October period of this fiscal year. The amount was Tk 156.42 billion in the same period last year.

DNS statistics revealed gross sales of savings tools worth Tk 353.28 billion and cash inflows of Tk 260.04 billion in the four months. On the other hand, the performance payments during the period amounted to Tk 118.12 billion.

The highest net sales were Tk 88.45 billion for the Family Savings Certificate, followed by Tk 24.41 billion for the Three-Month Profit Savings Certificate and Tk 10.83 billion. Tk for Bangladesh Five-Year Savings Certificate.

The government has set the target for borrowing savings tools at Tk 303.02 billion for the 2021-22 fiscal year.

Meanwhile, the DNS showed net sales of national savings tools as high as Tk 419.59 billion in fiscal year 2020-21 against a target of Tk 200.00 billion.

About 20 million investors are involved in this industry, DNS officials said.

At the same time, the significant drop in sales of cash certificates forced the government to increase its borrowing from the country’s banking system, official figures revealed.

The government borrowed more than double last Sunday by issuing two types of treasury bills (treasury bills) – 91 days and 364 days – to partially cover its budget deficit.

A total of Tk 66.81 billion was borrowed that day instead of the Tk 25 billion pre-auction target through the issuance of treasury bills, officials said.

The deficit in public accounts stood at around Tk 45 billion as of December 5, compared to Tk 22.50 billion two days earlier, according to official data.

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