It must be a pleasant surprise for the National Savings Schemes (NSS) investors that the State Bank has taken the right initiative and done a great justice to reduce the inconvenience faced by them at the counters of national saving centres almost every month. According to a circular issued by the SBP on 11th January, 2017, it has now allowed clearing house membership to the Central Directorate of National Savings (CDNS), which will enable widows and senior citizens to deposit National Savings issued instruments directly into their bank accounts anywhere in Pakistan. All banks have been instructed to accept profit coupons and withdrawal slips of CDNS-run Pensioners Benefit Accounts, Behbood Saving Certificates and Saving Accounts and these banking instruments will be cleared through National Institutional Facilitation Technologies (NIFT). NIFT is a joint venture between a consortium of six major banks and the private sector. All commercial banks in Pakistan are members of its clearing system.
It may be mentioned have that though the latest initiative of the SBP would be greatly appreciated by investors in National Saving Schemes, particularly the elderly and widows, a very long time taken to introduce such a step is largely incomprehensible. It was no secret that it was a long-standing demand of investors because prior to clearing house membership of CDNS, they were required to personally visit their saving centres to receive their monthly profits almost every month. This was a source of great inconvenience for investors, especially widows and senior citizens, who had to wait in long queues in inhospitable environments to receive their profits. Since the CDNS has now been included in NIFT as a regular member of clearing house, banks would credit profits into respective accounts of investors after successful clearance from saving centres. This initiative would thus enable investors to receive profit/credit directly into their bank accounts. Needless to say, this would not only be a source of great convenience for investors but would serve as a safe mechanism for the general public. There are many instances in which investors, after getting profits, were robbed at the gates of saving centres.
The initiative could also yield certain other benefits. Since investors in NSS would be obliged to open bank accounts to get the intended facility, the new measure would encourage banking habit and may also increase, albeit modestly, the saving rate in country's economy. Also, the investors would no more be required to change their saving centres if they shift from one place to another within the country. However, it is difficult to understand why the CDNS itself has not been enabled to remit the monthly profits of investors to their bank accounts regularly at their request. This would have facilitated investors more. May be there is some technical hitch in this which we don't know. Besides, it is difficult to understand the rationale of excluding certain schemes like regular monthly income certificates from the ambit of the present initiative. Hopefully, the SBP would also think about these suggestions in the next phase.