Short Term Savings Certificates rates

ISLAMABAD: The Central Directorate of National Savings (CDNS) has 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.

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 30 percent. These rates are applied uniformly regardless of the investment date or profit amount.

The adjustment in profit rates reflects the government’s efforts to align financial instruments with the prevailing economic conditions, offering revised incentives to investors while managing fiscal dynamics effectively.