National Savings likely to launch Dollar Certificates by May 2018


KARACHI: Central Directorate of National Savings (CDNS) is planning to launch saving certificates in US dollars to encourage overseas Pakistanis to invest this financial instruments. This dollar based security is likely to be launched in the last quarter of this fiscal year.
The dollar certificate is may be launched by May or June this year, said Zafar Masood, Director General National Savings while talking to a local TV channel.
He estimated that about one billion dollars would be invested in this security by overseas Pakistanis.
The tenure of such certificates will be 3 to five years.
National Savings has developed a unique product named as OPSCs which aims at targeting the remittances from non-banking channels and the Savings which are not channelized in Pakistan currently and held back in the resident countries of the Overseas Pakistani. Such an initiative of National Savings will provide Overseas Pakistanis an attractive opportunity to park their hard-earned savings in a more reliable and secure Government-backed securities in their home country. Furthermore, official remittances will also increase from current $20 billion mark.
OPSCs envisaged to be the Pakistan’s first of its kind risk-free and script-less security for Overseas Pakistanis on tap basis, like all other retail products of CDNS/ Government of Pakistan, which will be mutually helpful to both the Government and the Overseas Pakistanis. It is proposed to be offered in both the US Dollars and Pakistan Rupees. The proposed tenor will be 3 and 5-year with monthly profit. While the custodian of the product will be CDNS as it is for all the other retail products of the Government.
The product is proposed to be launched initially in the Gulf Cooperation Council (“GCC”) and then subsequently be rolled out in UK and USA markets and in third phase across the globe, keeping in view the regulatory requirement of the market.
National Savings estimates to fetch initial investment in the range of $550 million and $1,200 million per annum on the basis of 1/4th of 4.5 million Overseas Pakistanis living in the initial target market (GCC) if they invest only a minimum investment of $500.
It is expected that the OPSCs will send immense positive vibes throughout Pakistani diaspora spread around the world. The remittances will enhance from the banking channels further through this initiative. The product offering will make them feel that the Government back home cares for them and is coming up with innovative solutions to safe-guard their savings by providing both secure and lucrative investment platforms.
National Savings has already appointed the consortium of EnY, Haidermota & Co and Al Tamimi & Co as the Advisor(s) through an Request for Proposal (“RFP”) process, who will be responsible for structuring of the proposed OPSCs, analyzing the taxation and legal matters in the target markets, preparing RFP for appointment of the Manager/ Operator (who will manage the back-office of this product), and identifying the potential agents/ distributors in the target markets.