The Central Directorate of National Savings (CDNS) is all set to launch new prize bonds of Rs25,000 denomination, in addition to the existing six denominations of Rs200, Rs750, Rs1500, Rs7500, Rs15000 and Rs40,000, sources in the finance division told Profit on Friday.
The decision will not only plug the huge gap between the existing Rs15,000 denomination bonds and Rs40,000 denomination bonds and make the prize bond scheme more attractive and diversified in terms of various denominations but also attract additional investment of approximately Rs20 billion (gross) for the CDNS. Against the face value of Rs25 billion for a series of 999,999 pieces, there may be additional investment of approximately Rs20 billion (gross) while the net inflow would be around Rs5 billion, the CDNS estimates. CDNS is of the view that in view of the decision of the ECC regarding discontinuation of all kind of institutional investment in National Saving Schemes, it has become imperative that new avenues of saving be explored to boost the investment in saving schemes to accomplish the ever-rising investment target. Further, it will create a new avenue of investment to meet the target fixed for the next financial year especially in view of expected shortfall as a result of discontinuation of all institutional investment.
According to the CDNS proposal, the draw for the new prize bonds of Rs25,000 denomination will be held on the 15th day of March, June, September and December every year. The first prize for the Rs25,000 denomination bond will be Rs50 million. There will be three prizes of Rs15 million each and 1696 prizes of Rs312,000 each, said the CDNS notification of draft amendment in Prize Bonds Rules, 1999 for introduction of new prize bonds of Rs25,000 denomination.
According to the sources in the finance division, CDNS had sought approval of the finance division for launching the new prize bonds of Rs25,000 denomination. Before the formal approval, the finance division had asked CDNS to furnish whether the proposal will not involve the diversion of investment from the existing denominations of bonds to the proposed one. The finance division also asked the CDNS to submit the complete proposal in consultation with SBP which primarily manages floatation, arrangement of draws and maintenance of the stock of prize bonds both in circulation and unsold.