Net sales of National Savings Certificates (NSCs) plunged by 63 per cent in the first two months of the financial year 2025-26 amid persistent inflation and tighter government borrowing strategy.
According to Bangladesh Bank data, net NSC sales fell to Tk 1,572 crore in July鈥揂ugust 2025, down from Tk 4,223 crore in the same period a year earlier.
Although the figure remains positive, the sharp decline highlights how inflation and shifting investment patterns continue to strain the small-saver segment.
In recent years, NSC sales have been on a sustained downtrend, with net sales turning negative for three consecutive fiscal years.
In FY24, net sales hit a record negative Tk 21,124 crore, compared with negative Tk 3,295 crore in FY23 and negative Tk 6,063 crore in FY22.
The total outstanding amount of NSCs rose marginally to Tk 3,50,492 crore in August 2025, from Tk 3,40,071 crore a year earlier.
Economists and bankers said that the sharp fall in sales primarily reflects the impact of inflation, which has remained above 9 per cent for nearly three years.
In August 2025, inflation eased slightly to 8.29 per cent but continued to pressure household finances.
As a result, many savers are encashing their matured certificates to cover rising living costs rather than reinvesting in new ones.
At the same time, deposit rates in banks have risen, with several private commercial banks offering returns between 9 and 11 per cent on fixed deposits鈥攃omparable to or higher than some NSC rates.
The added liquidity, flexibility, and digital accessibility of bank deposits have made them more attractive to savers, analysts noted.
The government鈥檚 borrowing strategy has also shifted away from NSCs because of their higher interest burden.
Servicing NSC debt costs the government more than borrowing through banks or treasury instruments.
As a result, the government has focused on repayment rather than issuance, reducing its reliance on savings tools.
In July鈥揂ugust 2025, the government鈥檚 net borrowing from the banking system was negative Tk 2,516 crore as it continued repaying loans to banks.
For FY26, it has set a borrowing target of Tk 1.04 lakh crore from banks, down from Tk 1.36 lakh crore in FY25.
Policy measures have also curbed demand for savings certificates.
Since 2021, the government has reduced NSC interest rates by up to two percentage points and made national ID and proof of tax return mandatory for purchases exceeding Tk 5 lakh.
These steps, intended to prevent misuse by wealthy investors, have deterred some genuine savers.
NSCs were once a key deficit-financing tool for the government, with net sales reaching Tk 52,417 crore in FY17 and Tk 49,939 crore in FY19.
