The Government of Pakistan introduced Defence Savings Certificate scheme in the year 1966. The scheme has specifically been designed to meet the future requirements of the depositors. This is 10 years' maturity scheme with built in feature of automatic reinvestment after the maturity. These certificates are available in the denominations of Rs.500, Rs.1000, Rs.5,000, Rs.10,000, Rs.50,000, Rs.100,000, Rs.500,000 and Rs.1,000,000/=.
Who Can Invest?
These certificates can be purchased by a single adult, a minor, two adults
in their joint names with the options of payable to the holders jointly (Joint-A
) or payable to either (Joint-B). An adult can also purchase these certificates
on behalf of a single minor, two minors jointly or himself/herself and a minor
jointly. In addition to above individual investors, the following institutions
are also allowed to invest in the scheme, subject to their registration under
the relevant law for the time being in force:
- Registered Charities (Non-profit bodies).
-
Public Sector Enterprises excluding Banks.
-
Private Educational & Health Institutions.
-
Employees Old Age Benefit Institutions (EOBIs).
-
Private Corporate Sector registered with the SECP excluding Banks.
-
Non-Bank Financial Institutions (NBFIs) excluding Insurance Companies.
How To Purchase?
These certificates can be purchased from any National Savings Centre (NSC),
Pakistan Post Offices (PPO), Authorized branches of Scheduled Banks and State
Bank of Pakistan (SBP) by filling in a prescribed form called SC-1, which is
available at all the above offices of issue free of cost. A copy of the
Computerized National Identity Card (CNIC) or in case of a foreign national, a
copy of the Passport is required to be attached with the application form.
Mode of Deposit.
These certificates can be purchased by depositing cash at the issuing office
or by presenting a cheque. The certificates shall immediately be issued on
receipt of cash. However, in case of deposit through cheque the certificates
shall be issued from the date of realization of the cheque after receipt of the
clearance advice.
What Is The Investment Limit?
The minimum investment limit is Rs.500/-, however, there is no maximum limit of investment in this scheme.
What About Redemption
These certificates are encashable at par any time after the date of purchase.
However, no profit is payable if encashment is made before completion of one
year.
What is the return?
In this scheme the profit is paid on maturity or encashment for completed
years. Every Rs.100,000/- will become Rs.108,000/-, Rs.117,000/-, Rs.128,000/-,
Rs.142,000/-, Rs.160,000/-, Rs.183,000/-, Rs.213,000/-, Rs.251,000/-,
Rs.298,000/- and Rs.356,000/- on completion of 1, 2, 3, 4, 5, 6, 7, 8, 9 and 10
years, respectively. These rates are effective from 1st January, 2011. The
average compound rate of return on maturity presently works to 13.55% p.a. For
any other time period rates table is also available on website.
Tax & Zakat Status:
At present, the profit earned is exempt from withholding tax, if the total
investment in the scheme by the investor(s) does not exceed Rs.150,000/-.
However, withholding tax @ 10% is deductible at source on the profit(s) earned
if the total investment exceeds Rs.150,000/- by the investor(s). The Zakat is
collected at source as per rules.
