Regular Income Certificates profit rates revised for February 2025

KARACHI: The Central Directorate of National Savings (CDNS) has announced a reduction in profit rates for Regular Income Certificates (RICs), effective from February 14, 2025.

Introduced in 1993, the Regular Income Certificates are designed to meet the monthly financial needs of the general public.

These certificates are available in denominations of Rs50,000, Rs100,000, Rs500,000, Rs1,000,000, Rs5,000,000, and Rs10,000,000.

The revised profit rate on Regular Income Certificates is now set at 11.74 percent (pc), down from the previous 11.88pc. This adjustment means that investors will receive a monthly payout of Rs979 per Rs100,000 investment, compared to the earlier Rs1,010 for Regular Income Certificates.

Despite the cut, investments in Regular Income Certificates remain exempt from Zakat deductions, providing a stable and secure investment option for the public.

The taxation on profits from these certificates depends on the investor’s tax status. Individuals listed in the Active Taxpayer List (ATL) are subject to a withholding tax rate of 15 percent on the yield, while non-filers, not appearing in the ATL, are taxed at a higher rate of 35 percent. These rates are applied uniformly regardless of the investment date or profit amount.

Earlier, CDNS decided to change the profit rates on Short Term Savings Certificates, effective February 2025. This adjustment comes in response to the decline in inflation across the country.

The federal government introduced Short Term Savings Certificates (STSCs) in 2012 to cater to the short-term funding needs of investors. These certificates offer maturity options of three months, six months, and one year.

The program is accessible to both Pakistani nationals and Overseas Pakistanis, allowing investments starting from a minimum of Rs10,000 with no upper limit. Investors also have the flexibility to pledge these Short Term Savings Certificates as security.

Short Term Savings Certificates rates for February 2025:

Under the revised rates, the profit for a three-month maturity certificates has been set at 11.24 percent, yielding Rs2,810 on an investment of Rs100,000, compared to the previous rate of 12.76 percent

For six-month maturity certificates, the new profit rate is still 11.32 percent, amounting to Rs5,660 for every Rs100,000 invested, a decrease from the earlier rate of 12.74 percent, which provided Rs6,370.

The one-year maturity certificates now offer a profit rate of 11.38 percent, resulting in a return of Rs11,380 on the same investment amount.