Govt to adjust savings certificate interest rates after budget: Muhith

Finance Minister AMA Muhith has said the government will adjust the interest rates of savings certificates after announcing the budget for fiscal 2018-19.

Finance Minister AMA Muhith attends a pre-budget discussion organised by the DCCI, Channel 24 and Samakal at the Bangabandhu International Conference Centre on Saturday. Finance Minister AMA Muhith attends a pre-budget discussion organised by the DCCI, Channel 24 and Samakal at the Bangabandhu International Conference Centre on Saturday.

Finance Minister AMA Muhith attends a pre-budget discussion organised by the DCCI, Channel 24 and Samakal at the Bangabandhu International Conference Centre on Saturday. Finance Minister AMA Muhith attends a pre-budget discussion organised by the DCCI, Channel 24 and Samakal at the Bangabandhu International Conference Centre on Saturday.

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.

Finance Minister AMA Muhith attends a pre-budget discussion organised by the DCCI, Channel 24 and Samakal at the Bangabandhu International Conference Centre on Saturday.

The government borrowing from the savings tools certificates exceeded its target by 10 percent to Tk 538.32 billion in the first eight months of the current fiscal year.

Speaking at a pre-budget discussion on Saturday, Muhith said, “All the quarters agree that the interest rates of savings certificates are a bit high. The rates in this sector will be adjusted after the budget.”

Dhaka Chamber of Commerce and Industry, Dainik Samakal, and Channel 24 organised the discussion at the Bangabandhu International Conference Centre in Dhaka. 

Muhith had also wanted cut the rates in the budget for the current financial year, but had backed off following criticisms.  

A volatile capital market and fall in banking interest have encouraged people to invest in the savings certificates. Even the recent increase in interest rates at several banks has not slowed down the sales of savings certificates.