Govt not changing savings certificate interest rates before election

The Bangladesh Bank and the Internal Resources Division are working on readjustment of savings certificate interest rates but that is not happening before the next general election.

Finance Minister AMA Muhith informed the reporters about the decision at a programme in Dhaka on Tuesday.    

The interest rates of savings certificates were cut for the last time in 2015 by an average 2 percent to rein in sales.

Muhith had been saying he would cut the rates further as the government borrowing from the savings certificates is rising along with the sales.

File Photo

He had said he would cut the rates in the budget or after it, but could not do it following pressure from MPs.

On Tuesday, he said the central bank and the IRD had been asked to work on the readjustment of the rates and submit a report within two months, based on which the government would take a final decision.

Asked from when the new rates would be effective, he said, “No possibility of implementing the new rates before the next election.” 

He also said an ‘automated system’ would be launched in January to sell savings certificates.

The next election will be held by the end of this year.