Everything you should know about National Savings, Prize Bonds, Results, Draw & Schedule
The national savings are an important asset to any country and they are the combination of public and private savings in Pakistan also. Normally in economics, this is equal to the amount when the national income is subtracted from government purchases and consumption. Prize bond of Pakistan also comes in the subcategory. This is actually a fund that is raised in order to offset the borrowing of government and at the end of maturity, these bonds are refunded to the owners. Some of the important details about the prize bonds and national savings will be discussed in this article.
What is national savings?
When studying economics, the question about what is national savings arise in the mind of the reader. There is another common economic indicator that is known as national income or GDP. To analyze the financial and economic conditions of any economy, this indicator is kept in mind. It is normally the combination of investment, consumption, and purchases made by the government. The amount that is spent on government and consumption is subtracted from these and the final result is national savings. All these are really important pointers of any economy.
What are Prize Bonds?
The national treasury management agency in Pakistan is the main authority for the issuance and governance of prize bonds. This is actually a product that is offered to the personal savers. It is part of a state saving and places the money directly in the government treasury. The saver can withdraw it anytime even before maturity if he is in need of money. This is an unconditional obligation that is repaid directly to the saver without any problem. The complete management of this product is done by the government. This is a completely legal security for investing the money of private savers of any state.
A unique investment
Prize bonds are the unique figure for investment especially for the people of Pakistan where the business environment is really unpredictable. The exciting thing is that the person gets to have thrilling prizes rather than the interest. Even the tax prizes given to people are free from the taxes and they can be converted into cash anytime. The minimum holding period for prize bonds is of three months. The person just has to buy prize bonds and with the help of lucky draw, participants have the chance to win prizes.
The prizes are given to people with the help of lucky draw conducted every week. Draw list is broadcasted on the local television of Pakistan so that people get the results fairly. The people getting their names in draw list can convert the prizes into cash. Normally the minimum time for holding is of three months. The draw results in Pakistan are completely fair because they are random and done on the basis of results from software. In most states, these are conducted twice a year. Once they are awarded in the middle and then at the end of the year. Other than these biannual drawing carried out twice a year, the weekly prize funds are awarded to the participants. The drawings are done particularly in the cities of Hyderabad, Karachi, Quetta, and Multan on specified dates.
There are some great features presented by these prize bonds. The normal profit rate of prize bonds is 1.5% on a biannual basis. The registration of these bonds is done in the name of investors. Also, these deposits are offered for private sectors, public sectors, and individuals. The institutes excluding this list are the insurance companies, mutual fund companies, and banks. The prize money is directly credited to the account of the investor. Also, the profit is given to the investor directly without any lengthy procedures. There is no need to fill any application forms for claiming the profit and prize money. The tenure and the investment money are unlimited. Also, in Islamic countries, it is exempt from the taxes.
Another really important feature of prize bonds is that they are transferable to any other party. This means that it is highly liquid and can be given to any other party in place of cash. They can also be pledged in place of any other thing as a security. The purchase of prize bond can take place against the cash money, pay – order, bank draft, and cheque. The place from where it can be purchased in the State banks and also post offices.
The schedule for lucky draw is announced formally. There are certain dates on which the lucky draw is done in the offices of a state bank in different cities of a state. If the given date is a public holiday, the drawing will be conducted on the next working day. The application is given to the office and the further processing takes place. Special privilege is provided to the senior citizens because they do not have to wait for their turn and can directly request on the counter.
There is a minimum purchase price for these bonds and the person can get them at this price originally. The unit price increase based on the demand. The amount generated by the sale of prize bonds has increased than the base price. Sometimes, serious concerns are brought up by the government because it does not generate the real value for money. The government actually borrows the funds in this process and they have to see relativity in the cost of interest and cost of administration. If the cost of administering the whole process is more than the cost of interest, then this is not beneficial for the government and vice versa. The highest prize money for the premium bonds is 80 million rupees.
Prize bond is actually a form of national savings and this should contribute to the budget surplus. The public, as well as private savings of a country, contribute to the overall national savings. The consumption and government expenses are subtracted from the income and then the savings are left over. The worth of prize bonds is available on the internet with a complete schedule of the whole year. The student welfare bonds are also included in this along with the other bonds of different worth. This is a safe investment that has really less risk and any investor can trust on this without any doubt.