Profit rates on all savings certificates slashed again

The government has once again cut interest rates on all types of national savings certificates, with the revised rates set to remain in force for the next six months.

A notification issued by the Internal Resources Division (IRD) said the new rates took effect on 1 January 2026.

Under the revised structure, the rate on Family Savings Certificates for investments of up to Tk7.5 lakh at the end of the five-year term has been reduced from 11.93% to 10.54%, while returns on investments exceeding Tk7.5 lakh have been lowered from 11.80% to 10.41%.

The profit on Pensioner Savings Certificates at maturity after five years for investments of up to Tk7.5 lakh has been reduced from 11.98% to 10.59%. For investments above Tk7.5 lakh, the return has been lowered from 11.80% to 10.41%.

For the five-year Bangladesh Savings Certificate, the profit rate at maturity has been fixed at 10.44% for investments of up to Tk7.5 lakh, while those investing more than Tk7.5 lakh will now earn 10.41%.

Returns on three-monthly profit-based savings certificates have also been cut. At maturity, investments of up to Tk7.5 lakh will now yield 10.48%, down from 11.82%, while returns on investments exceeding Tk7.5 lakh have been reduced from 11.77% to 10.43%.

However, profit rates on the Wage Earner Development Bond, US Dollar Premium Bond, US Dollar Investment Bond, and the general account of the Post Office Savings Bank remain unchanged.

Family Savings Certificate remains the most popular instrument among the various savings products managed by the National Savings Directorate, as many households rely on returns from these investments to meet regular family expenses.

Bangladesh has been grappling with elevated inflation for the past two to three years. Data from the Bangladesh Bureau of Statistics (BBS) show that point-to-point inflation stood at 8.29% in November 2025, with little change observed in market prices in December. Against this backdrop, the latest cut in savings certificate returns is likely to add further strain on households that depend on interest income to manage daily costs.

Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD), told TBS that lowering returns on savings schemes would disproportionately affect fixed-income earners and retirees, particularly at a time of persistently high inflation. 

She also noted that while the move aims to reduce the government's interest burden, it would have been more beneficial for the public if the rate cuts had been implemented after inflation eased to a more manageable level.

Pre-July 2025 savings schemes are unaffected

For all National Savings Schemes issued before 1 July 2025, the interest rate fixed at the time of issuance will remain effective until the maturity period. However, in the case of reinvestment, the rate prevailing on the date of reinvestment will apply. The rate will be reviewed and reset again after six months.

To meet budget deficits, the government borrows from domestic sources through savings schemes. In the current fiscal year's FY26 budget, the government has set a target of Tk12,500 crore in net borrowing through National Savings Schemes. In the original budget of the previous fiscal year, the target was Tk15,400 crore, which was later reduced to Tk14,000 crore in the revised budget.

According to Bangladesh Bank sources, during the first four months of the current fiscal year (July-October), the government borrowed a net Tk2,369 crore from various savings schemes. 

At the end of the previous fiscal year, net borrowing stood at a negative level of more than Tk6,000 crore. For the past three fiscal years, sales of savings certificates were lower than encashments, resulting in negative net sales. Overall, as of the end of last October, the government's outstanding liabilities from savings certificates stood at Tk3,40,868 crore.