The Finance Division has notified extension in date for exchanging / conversion of bearer prize bonds of denomination of Rs40,000, Rs25,000 and Rs15,000 from September 30, 2021 to December 31, 2021.
The date has been extended for unregistered prize bonds. In order to comply with the Financial Action Task Force (FATF) for the prevention of money laundering and terror financing, the government had decided to document the financial instruments by the withdrawal of bearer prize bonds.
So far the government has decided to withdraw prize bonds of four denominations including Rs40,000, Rs25,000, Rs15,000 and Rs7,500. However, the last date for exchanging Rs7,500 denomination bearer prize bonds is December 31, 2021.
The government started withdrawal of bearer prize bonds with Rs40,000 denomination on June 24, 2019. Later, on December 10, 2020, the government announced to discontinue the circulation of Rs25,000 denomination prize bonds. In April 2021, the finance ministry announced that national prize bonds of denominations Rs7,500 and Rs15,000 shall not be sold.
The finance ministry has issued the following procedure for encashment/exchanging the bearer prize bonds.
The premium prize bonds can be converted to premium prize bonds (registered) of denomination of Rs25,000 and Rs40,000 (subject to the adjustment of differential amount) through 16 field offices of State Bank of Pakistan’s (SBP) Banking Services Corporation, and branches of six commercial banks i.e. National Bank of Pakistan, Habib Bank Limited, United Bank Limited, MCB Bank Limited, Allied Bank Limited and Bank Alfalah Limited.
The bonds can be replaced with SSC/DSC through the 16 field offices of SBP Banking Services Corporation, authorized commercial banks and National Savings Centres.
The bonds will only be encashed by transferring the proceeds to the bond holder’s bank account through the 16 field offices of SBP Banking Services Corporation as well as the authorized commercial bank branches and to the Saving Accounts at National Saving Centres.
The last date for redemption was due to expire on September 30, 2021. This is the third time that the government has given extension in the deadline for the conversion of prize bonds.
According to SBP’s data, the National Savings Schemes (NSS) witnessed a huge outflow of investments during the fiscal year 2020-21, clocking in at Rs317.25 billion, compared to the inflows of Rs370.9 billion recorded in the preceding fiscal year. Prize bonds accounted for 92 percent of this outflow, at a whopping Rs290.38 billion.