Bangladesh Bank (BB) has urged all scheduled banks to take an extra cautionary stance regarding the investment of the employees’ provident funds in the National Savings Certificates (NSC).
To this end, the central bank issued a directive on Tuesday, in an effort to stop misuse of the institutional funds because of high-interest rates on savings certificates.
“It is mandatory to avail a certificate from the tax commissioner prior to purchasing the NSCs with the fund,” the directive stated.
The online management system for savings tools has been introduced across the country from June 30.
In the regular monitoring of the system, it has been noticed that large amounts of money from different organisations are being spent in buying NSCs on the pretext of their employees’ provident funds.
“As the NSCs are now being sold online, the whole process can easily be monitored,” said Md Khurshid Alam, general manager of the BB’s Debt Management Department.
It has been found that the provident fund money of different organisations has been invested in the savings certificates, he also said.
The banks have been alerted so that the tax commissioner’s certificate is taken in this regard as per rules, he added.