National Savings Centre Adjusts Profit Rates for STSCs

The National Savings Centre has recently made changes to the profit rates of its financial products, including the Short Term Savings Certificates (STSCs). These certificates, introduced in July 2012, are designed to meet the short-term funding needs of investors. The latest adjustment in profit rates took place on May 14, 2024, offering investors a range of options with varying maturity periods.

STSCs come in 3-month, 6-month, and 1-year maturity schemes, providing flexibility for different investment preferences. Both Pakistani nationals and Overseas Pakistanis have the opportunity to invest in these certificates individually or jointly. The minimum investment amount required is Rs10,000, with no maximum limit imposed, making it accessible to a wide range of investors.

The profit rates for STSCs differ based on the chosen maturity period. Investors opting for the 3-month maturity category can earn a profit rate of 20.20 percent, while the 6-month maturity category offers a profit rate of 19.38 percent. Those selecting the 1-year maturity scheme stand to gain a profit rate of 19.24 percent on their investment.

When it comes to tax implications, filers listed in the Active Tax Payer List are subject to a 15% withholding tax rate on the yield or profit generated from STSCs. Non-filers, on the other hand, face a higher withholding tax rate of 30%. It is important to note that investments in STSCs are exempt from Zakat collection, providing a tax-efficient investment option for individuals.

The adjustments in profit rates for Short Term Savings Certificates offer investors a competitive opportunity to earn attractive returns on their short-term investments. With flexible maturity periods and accessible investment amounts, STSCs cater to a wide range of investors looking to grow their savings. Understanding the tax implications associated with these certificates is crucial for making informed investment decisions. Overall, STSCs present a convenient and tax-efficient way for individuals to achieve their financial goals.