Savings schemes are a semblance of hope for the future, especially amidst the uncertainty of 2023 and beyond. In Bangladesh, several kinds of savings schemes are offered by banks and other Non-Banking Financial Institutions (NBFI). Below are some which can benefit us depending on our need and purchase capacity.

Fixed deposits

Any commercial bank or NBFI in our country has a portfolio of Fixed Deposits. FDs remain a popular investment instrument for many people. At least 70 per cent of us invest in FDs. These range from 1 month up to 5 years at different interest rates. Needless to say, the longer the fund remains with the institution, the higher the interest rate will be, hence the return on investment will be higher too.

Depending on what the customer wants, banks or NBFIs cater to their needs. At the moment, good interest rates are being offered. Fixed deposits also come with loan/overdraft facility against FDs.

FD tenure is usually time-bound and in case of premature closure, the customer could be liable to deduction of interest or imposition of applicable charges. Banks and NBFIs also deduct tax at source on the interest earned as it is a regulatory requirement.

Sanchayapatras

Sanchayapatras (SPs) are a safe avenue for investing funds. New interest rates on SPs have been announced in 2022. Banks and Post Offices will be able to provide the information and required forms. There are different kinds of SPs yielding different rates and returns — 5 years SP, 3 Years SP with interest withdrawal facility every 3 months, 5 years Pensioner SP, Post Office General, and Post Office 3 years SP.

Customers who are eligible can invest in US Dollars. These investment instruments are Wage Earners Development Bonds, US Dollar Premium Bonds up to 3 years, US Dollar Investment Bonds up to 3 years.

Deposit Pension Schemes (DPS)

A lot of banks in Bangladesh open Monthly Deposit Schemes for their customers. Instalment size can be from Tk 500 to Tk 25,000 monthly. A DPS can be opened by anyone 18 years and above for a term of 3 years up to 15 years. Some salient features of the DPS in different banks are:

·     Attractive and competitive interest rates

·    No hidden charges

·    Tax benefits as investment rebate

·    SOD loan facilities can be availed

·    No online charges for monthly deposit

·    Customers will enjoy charge free Savings Account which is used only for DPS purpose

·    Automatic realisation of monthly instalments

·    One person can open more than one "Contributory Savings Scheme"    

·    Deposit the instalment at any branch through the month around the country

·    Preferential Interest Rate for Senior Citizens (60 years and above)

It would be prudent to invest in any of the above. Investments are savings which to an extent can save us from unforeseen financial despairs.

Photo: Sazzad Ibne Sayed
The writer is the Managing Director, Connect Consulting Ltd