Pakistan Banao certificates

[fitpOsitive]

Depending on when it's launched i'd be tempted to go for 3 year version. No guaruntee who the next govt will be and if you'll ever see your money again.

Currently $5000 is about £3800.

Can anyone calculate how much you should expect to see back from that?

That's the thing.
I will reiterate that govt should make company for each project that will continue to work even after this govt. We ready to invest, but assure us. Chanda jitna dysaktay thy dia. Ham kitna daingy. Aik waqt aaeyga keh log bol uthaingy. Had hoti hai her bat ki.

 

[Cherokee]

What is the fixed deposit interest rate offered to Pakistanis living abroad to funnel their money back into the country?

 

[shahbaz baig]

Need to figure out how to buy these certificates.

Rate is

Here is info regarding PBC. What is Pakistan Banao Certificate.

 

[Yaseen1]

Its effectiveness depends on whether govt uses amount raised wisely or waste it in loss making business　and corruption like in past .I think govt will increase interest rate of Statebank and lend the amount raised through certificate and earn through difference of the interest rates of State bank and rate of return of certificate holders .It must be based on profit or loss sharing rather than being based on interest which is biggest sin in Islam

 

[shahbaz baig]

Pakistan Banao Certificates: What is the scheme and how to invest in it?
Pakistan
Web Desk
Thu, Jan 31, 2019

ISLAMABAD: Prime Minister Imran Khan on Thursday inaugurated ‘Pakistan Banao Certificates’ scheme to attract investment from overseas Pakistanis to help strengthen the national economy.

What is Pakistan Banao scheme?

According to official twitter handle of Imran Khan’s PTI, the Pakistan Banao Certificates is the first initiative of its kind for Overseas Pakistanis. They get a unique opportunity to safely invest their savings with higher profits rates than United States, Europe, Gulf countries while helping build Pakistan.

Overseas Pakistanis will be able to earn profits from their investment in certificates.

It is a revolutionary initiative of Pakistan government to enable the Overseas Pakistanis to buy the Certificates and their investments will not only drive Pakistan towards progress and prosperity but also they’ll be able to get profits from it.

How to subscribe:

Pakistan Banao Certificates is a sovereign US Dollar denominated retail level instrument, for Pakistanis having bank accounts overseas. The subscription process is easy and completely automated.

Click here for registration

Digital Subscription

PBC is being offered for subscription through a specially designed Web-Portal. The investors first register themselves on the portal and give their investment and bank account details on successful registration. The certificates are issued to the investors electronically on receipt of funds in State Bank of Pakistan Account given on the portal. The investor receives confirmation of the issuance of the certificates both through email and updation of their account on the portal. The investors can view the status of their application by accessing the web-portal through their respective User ID and Password.

Eligible Investors

The holders of any one or more of following documents and having own bank account abroad, are eligible to subscribe the PBCs.

• Pakistani individual having Computerized National Identity Card (CNIC).
  
• Pakistani individual having National Identity Card for Overseas Pakistanis (NICOP).
  
• Holders of Pakistan Origin Card (POC).

Minimum Investment Amount:

Minimum investment amount is USD 5,000 or higher in the integral multiple of US$1,000 with no maximum limit.

Profit Rate:

Profit rate on three years plan will be 6.25 percent payable bi-annually

Profit rate on five years plan will be 6.75 percent payable bi-annually

Transfer of Funds:

The investor will remit the intended investment amount from his/her own account outside Pakistan to the SBP account with National Bank of Pakistan (NBP) New York to be notified to the investors on completion of investment details on the portal.

Investors are requested to ensure that the funds reaching the SBP account with NBP New York are equivalent to their intended investment amounts net of bank charges, if any.

Type of Instrument:

PBCs is a scrip-less instrument registered in the Securities General Ledgers Account (SGLA) maintained at State Bank of Pakistan (SBP). PBCs so issued will be residing in an Investor Portfolio Security Account (IPS) of the investor, so as to keep track of investment of each individual investor.

Premature Encashment:

Premature encashment in Pak Rupees can be done anytime without levy or penalty. In case of encashment in USD within first year of issuance, a penalty of 1 percent will be levied

Key benefits

• Profit on bi-annual basis.
  
• Maturity in USD as well as PKR.
  
• PKR maturity has an added incentive of 1% on the final premium.
  
• Can be en-cashed at any time; however encashment in USD within one year of issuance entails 1 percent penalty
  
• Encashment application will also be submitted online by accessing the Redemption module of PBC portal
  
• Periodic Profit and redemption proceeds will be sent to the investors’ accounts designated at the time of investment

 

[Tps43]

View attachment 536529

@Retired Troll amreika walon ke liya bht kam munafa

 

[El Sidd]

@Retired Troll amreika walon ke liya bht kam munafa

amreeka mujahid zindabad

 

[valkyr_96]

But surely there is a way to judge the risk associated with any investment such as these certificates. Is there another mechanism, or rating, that might help a potential investor?

There are but they are all subjective. I have already mentioned previously that Pakistan's Eurobonds have a rate between 7.875% to 8.25%, the Sukuks have a lower return ~5.5% possible due to it asset based nature. It is up to you to determine what is risky for you.

You can isolate the different risk premiums and come up with an expected return (example comparing the German bonds to the Greek bonds: even though the are in the same currency, but with different inflation and default expectations). you can also match the sovereign rating of the country against similarly sovereign rated securities and expect the returns to be the same (you can check Pakistan rating on trading economics). There are also PRS or political risk scores. You can find some data on Damodaran's website which I think is compiled bi-annually for his MBA classes (which you can take free online) although the same is part of the CFA material as well. But again it is highly subjective because it is one thing to rate a corporation and another to rate a sovereign. Ishaq Dar expected that the improved ratings would allow him to decrease the borrowing cost, much to his disappointment, the ~8% rates remained virtually unchanged. So while this is no financial wizardry (thankful we don't want that) the offered rates are lower that previously offered rates. Normally, the Arranger will cover partial or fully the unsubscribed amount, this option will not be available to Pakistan (hence the nationalistic theme). If the appetite is good, it will be a plus for the current government.

You can follow Pakistan's future IPOs and current listing on the luxembourg bourse https://www.bourse.lu/issuer-securities/Pakistan/34653 .The current issue is not in the same category but the same risks and considerations should apply.

The real issue is that the government has guaranteed the dollar investment (how? when it does not print dollars, even the Americans have trouble paying down there borrowings) with a nominal 1% charge (on on the first year) thus after the first year it better (for non-residing Pakistanis) than a savings account or a certificate of deposit. I don't need to post rates issued by American banks which are no where near the offered rate. Thus if the return is higher than the benchmark, it should technically be compensating for something. If there was a clarity as to how the government is going to pay back the principal and the profit rate, we can address the sovereign risk. Otherwise, these are highly liquid securities, albeit non-tradable, with a disproportionately high profit rate.

Other things to consider are taxes. If you are a non-filer, the tax applicable on the profit should be higher that a filer. This may be one of the goals of this investment scheme (to get people to file tax returns). I sincerely hope this is true, although some aholes in the government have scaled back similar schemes with regards to car and real estate purchase.

 

[Tps43]

amreeka mujahid zindabad

Zindabad zindabad

 

[valkyr_96]

@Retired Troll amreika walon ke liya bht kam munafa

I may be wrong, but I think you are misinterpreting the chart. The current scheme offers 6.25% to 6.75% whereas the US and KSA rates are the average/ expected comparable (on what basis?) rates that the Pakistani have an option to invest in their respective countries. These are not the rates offered to them by the GoP, which are as mentioned above for all non residing Pakistanis.

What is the fixed deposit interest rate offered to Pakistanis living abroad to funnel their money back into the country?

As far as I know none, this can be taken as such as they are offering 1% additional premium to convert it into rupees on redemption.

 

[Sugarcane]

Other things to consider are taxes. If you are a non-filer, the tax applicable on the profit should be higher that a filer. This may be one of the goals of this investment scheme (to get people to file tax returns). I sincerely hope this is true, although some aholes in the government have scaled back similar schemes with regards to car and real estate purchase.

How asking dual nationals and POC holders living and earning overseas to file tax returns will benefit Pakistan? It's resident Pakistanis who needed to be given bamboo to pay taxes and file returns.

 

[AZADPAKISTAN2009]

Pakistani living in Pakistan : 200,000,000 (200 Million people)
Pakistani living overseas : 3,000,000 ( 3 Million people)

If every one gave 1 dollar each , Locally it would raise 200 million , overseas it would raise 3 million and that is the simple example , power of Pakistani living locally in Pakistan and why it is crucial for

Pakistan to collect tax locally

Every Pakistani (Locally) is due to pay at least 9,000 Rupees ~ close to 100-150 dollar tax
for things to work out or go in right direction



Mythology:
a) Pakistan can get money from overseas 300 billion of so call stolen cash , when no foreign bank ever even discloses 1 dollar for their clients let along say 300 billion are from Pakistan
b) Every one that left Pakistan was rich as Zardari or Nawaz
c) Local people will die when they talk about tax

 

[valkyr_96]

How asking dual nationals and POC holders living and earning overseas to file tax returns will benefit Pakistan? It's resident Pakistanis who needed to be given bamboo to pay taxes and file returns.

tax return is not a tax, it just shows that you paid your taxes (if applicable). So if you purchase a property or car in Pakistan and paid a tax on it you should report it because in this way the government can keep a track of the formal sector and if the tax itself is being deposited or pilferaged before it reaches the coffers. Overseas Pakistan only need to file a wealth statement your overseas income is not subject to taxes (i believe).

 

[Sugarcane]

tax return is not a tax, it just shows that you paid your taxes (if applicable). So if you purchase a property or car in Pakistan and paid a tax on it you should report it because in this way the government can keep a track of the formal sector and if the tax itself is being deposited or pilferaged before it reaches the coffers. Overseas Pakistan only need to file a wealth statement your overseas income is not subject to taxes (i believe).

I was talking about part I quoted. GoP can't deduct WHT and will not deduct WHT on these certificates as it's selling the product in market where it doesn't have jurisdiction to charge taxes. So, that part of your post don't have any basis.

 

[valkyr_96]

I was talking about part I quoted. GoP can't deduct WHT and will not deduct WHT on these certificates as it's selling the product in market where it doesn't have jurisdiction to charge taxes. So, that part of your post don't have any basis.

Let see, without any supporting documents we can't say that with surety neither did I in my post. I am referencing these certificates as the SSC and the DSC where you do have to pay the WHT on the profit. These certificates are being issued by Pakistan through a portal and not being sold in any other jurisdiction, otherwise the certificates would be subject to due diligence and other reporting requirements especially since it is marketed to individuals not QIBs (I had answered this previously as well), thus I assume that Pakistan laws has jurisdiction.