Savers face dearth of govt savings tools

No supply shortage, says DNS

Arafat Ara | Published: October 27, 2018 09:55:05 | Updated: November 04, 2018 21:35:06

Supply shortage of different types of state-run savings certificates in many post offices and bank branches has been causing problems for many savers willing to invest funds in these instruments, insiders said.

Especially, the shortage of Family Savings Certificate (FSC) acute since the instrument that offers the highest yield rate has been on high demand.

But the availability of savings certificates at Department of National Savings (DNS) bureau offices has been almost steady.

Aspirant savers are not being able to buy savings certificates for many bank branches and post offices say they do not have the same in their possession.

Some investors suspect that the short supply is being created deliberately to limit their overall sales. The government's borrowing from the saving scheme has already overshot the target.

Talking to this correspondent, a good number of savers said they have been unable to buy FSCs and Three-Monthly Profit Bearing Savings Certificates despite trying for three to five months.

If the government has a plan to discourage selling savings certificates, it can officially impose restriction, so that people do not have to face hassles, they opined.

Sector insiders said the sales of high-yielding savings certificates have been rising during the last few years, as people do not have better investment options.

In the recent months the sales have increased notably, as the finance minister has announced that the yield rates on the savings schemes will be rationalised.

Zinat Hossain, a woman who came to Dhaka General Post Office (GPO) recently to purchase a FSC worth Tk 200,000, said earlier she had failed to purchase savings certificates of her choice. So, now she comes twice a month to get updated news on their availability.

"As I have been investing in the savings certificates by purchasing those from Dhaka GPO from the very beginning, I want to buy another one from here," she added.

Minara Begum, who wanted to purchase a FSC worth Tk 100,000, also visited GPO many times. She failed to buy a FSC worth Tk 50,000 from the office, as it has no savings certificates of low denominations.

The GPO officials said they have been facing the scarcity of FSCs since last six months.

Except FSC worth Tk 1.0 million, no other certificate is available in the post offices, said Farid Ahmed, director (Savings and Postal Life Insurance) of Directorate of Post.

The DNS is not supplying required number of savings certificates, he mentioned.

"We've recently placed a demand for 196,000 pieces of FSCs and 105,000 pieces of Three Monthly Profit Bearing Savings Certificates of different price denominations for different circles and divisions. Against the requirement, we got only 35,500 and 54,000 respectively."

"So it is difficult for us to meet the requirements of savers. We've already informed DNS about the supply shortage," he also added.

Officials of different banks branches echoed the same opinion, saying they are not getting savings certificates as per their requisition from their head offices.

When asked, an official of Sonali Bank Limited said they have been facing shortage of savings certificates for the last six months.

They get only 50 per cent of their savings certificates. They usually ask for. Those are sold within one week.

"As we cannot meet the savers' demands, they become annoyed with us. But we cannot do anything, as we are not the supplying savings authority," he noted.

Officials at a branch of Dutch-Bangla Bank Limited in Motijheel area said they cannot sell any savings certificates to clients for the last two weeks.

Many others commercial banks are also facing same problem. So, they are advising their clients to come after some days.

But officials at DNS said at present they do not have any savings certificates shortage, and their supply is smooth. They are regularly providing the certificates to banks and post offices as per their respective requirements.

Besides, the government has no immediate plan to reduce the sales of certificates, they added.

Sometimes post offices and banks create artificial crisis for their own interests, and also place irrational demand to DNS, they observed.

DNS Director General (Additional Secretary) Shamsunnahar Begum said there is no supply shortage of savings certificates at this moment. DNS is providing certificates to the post offices, banks and bureau offices as per their requirements.

She, however, refrained from making any comment when asked whether or not the government is curbing the sales of savings instruments.

Officials at Internal Resources Division (IRD) said as the demand for savings certificates is now very high, they sometimes fail to supply those in required number.

The government has no official directive to reduce their sales. But unofficially they are discouraging big investment, as the government's liability for interest payment has increased significantly in the last few years.

Currently, DNS sells four types of savings certificates, and their yield rates are up to 11.76 per cent.

According to a DNS study, post offices sell about 55 per cent of the total savings instruments, followed by banks 33 per cent, and savings bureaus 12 per cent.

The government's net borrowing target from the savings instruments in current fiscal year (FY), 2018-19, is Tk 261.97 billion. The borrowing from the savings certificates in this July-August period is Tk 90.57 billion.

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