Pakistan

Profit rate on savings accounts hiked by 1.5% to minimum of 7.25%

savings accounts profit rate

The profit rate on savings accounts is going to rise by 1.5 percent to a minimum of 7.25 percent by December 1, said the State Bank of Pakistan. 

In an announcement on Monday, the State Bank of Pakistan has said that the profit rate will increase by 1.5 percentage points to a minimum of 7.25% by Dec 1. The rate of profit has been raised after the central bank increased the policy rate to 8.75% from 7.25%.

SBP has asked the customers through social media to put up their complaints if less profit rate is offered on their savings accounts. If the complaints are not addressed properly, the central bank of the country has asked the customers to contact its customer complaint help desk.

From January, next year, it has been made mandatory for banks to provide the option to open accounts digitally with remote biometric verification and without the need for a customer to visit banks.  

Regarding the rumors about the inflation in the country, the State Bank of Pakistan said in a press release, “In some sections of the media, SBP’s average inflation forecast of 7-9% in FY22 is being interpreted as the ‘inflation target’ and being compared to the inflation target of other countries. This is incorrect. SBP’s inflation forecast represents our projections for the current fiscal year. On the other hand, Pakistan’s inflation target is set by the government and is 5-7pc. This target is to be achieved over the medium term. Monetary policy is anchored on achieving the government’s inflation target over the medium term, i.e., over the next 18-24 months.”  

Fahad Rauf of Ismail Iqbal Securities said that the inflation regime will be the focus of SBP in making the monetary decisions and the central bank’s amendments bill which has not been finalized so far highlights the bank’s objectives such as price stability, financial stability, and economic growth. He is of the opinion that keeping in view the current inflation rate, the interest rate would go high by 100-150bps to achieve mildly positive rates. 

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