Are you interested in a premium prize bond and want to know more about it, such as what is a premium prize bond? If yes, this article is for you.
Table of Contents
What Is A Premium Prize Bond
Premium prize bond is a newly launched national savings scheme where investors can make a profit and earn prize money.
The Central Directorate of National Savings (CDNS) started a prize bonds scheme called “PREMIUM PRIZE BONDS (REGISTERED),” equal to the National Prize Bonds Scheme.
Opposite to the National Prize Bonds (bearer), the Premium Prize Bond is a registered prize bond published in the name of a registered investor.
The investor receives a six-monthly profit on investment at a rate notified by the Government of Pakistan upon the end of six month period either from the date of issue or the date of last profit paid in addition to qualification for prize money in quarterly draws, subject to agreement to shut period requirements.
Premium Prize Bond Basics
The Premium Prize Bond is not an output of the State Bank of Pakistan. The Premium Prize Bond Scheme was started by the Central Directorate of National Savings (CDNS), and Bonds are assigned as a Central Government Debt.
The CDNS devises all policy-related matters/rules about this plan in coordination with SBP BSC. The SBP BSC serves as an agent to the Government for the management of this scheme.
Currently, there are two denominations, i.e., Rs. 25,000/- & Rs.40,000/- The Office of Distribution is the SBP Banking Services Corporation (SBP BSC) Office and Six approved commercial banks from where the Premium Prize Bond is issued.
Composition Of Premium Prize Bond Numbers
Each bond holds a unique alpha-numeric number where the alpha indicates the series, and the number exhibits bond serial numbers, e.g., A123456.
The list of prize bonds shall be issued in consecutive order except for I & O, which will not be applied as a series.
Each bond series contains one less than a million pieces of bonds, i.e., from 000001 to 999,999.
You can not take the Premium Prize Bond numbers of your choice.
Purchase Of Premium Prize Bonds
Since these bonds are registered in character, registration at the issue’s office before purchasing bonds is necessary. However, this exercise is needed to be completed once for each investor.
The following documents must complete the properly filled application form:
i. For Individual Investors:
a. Readable copy of valid CNIC / SNIC / Pakistan Origin Card (POC) (OriginalSeen)
b. Account Maintenance Certificate (not earlier than one month from the date of application) of the IBAN Number given in the application form declaring Bank and Branch Name, Title of Account, Account Number, and IBAN (Needed at the time of registration or change of Account Number). No AMC is needed if the customer wants to intend the same from commercial banks.
You can buy premium bonds from any conventional branch authorized by commercial banks to maintain accounts in these banks.
Maintaining an account in the applicant’s name (s) is compulsory to purchase Premium Prize Bonds. There is no highest limit in number or value for buying Premium Prize Bonds. Nevertheless, these bonds shall be issued in multiples of their face value only.
Any of the following may purchase these bonds:
a. A single adult.
b. Two adults in their joint names.
i. Payable to holder together or payable to either with the written permission of the other named “Joint Class A” or
ii. Payable to either termed “Joint Class B.”
Anyone may make the payment for the purchase of Bonds of the following methods:
b. Bank draft *
c. Cross Cheque *
d. Pay order *
* subject to realization of proceeds
Encashment Procedure Of Premium Prize Bonds
You can encash premium prize bonds only from the Office of Issue. There is no subtraction against the face value of Premium Prize Bonds upon encashment.
The registered investor shall be asked to fill an Application Form (PPB-2) with the subsequent documents at the time of encashment:
a. Original Premium Prize Bond appropriately signed on the reverse.
b. Readable copy of valid CNIC/ SNIC / Pakistan Origin Card (POC) (original seen)
c. Any other document (if any) as defined from time to time.
Moreover, you can encash your premium prize bonds and receive face value in your bank account.
Transfer Of Premium Prize Bonds
Also, these bonds are transferable. It means you can transfer the premium prize bond to anyone from the office of the issue, but the physical presence of both the Transferor and Transferee is mandatory.
There are no costs for the transfer. When you transfer your premium prize bonds, you renounce all rights on the profit, prize money, and face value (if any) to the transferee.
For transferal of Premium Prize Bonds, the following documents are needed:
a. Elemental Bonds to be transferred.
b. Distinct copy of valid CNIC/SNIC/Pakistan Origin Card (POC) of the transferor (Original Seen)
c. Clear copy of valid CNIC/SNIC/Pakistan Origin Card (POC) of the transferee (Original Seen)
d. Account Maintenance Certificate of a transferee for the IBAN Number given in the application form (Not old than one month from the date of application).
Procedure Of Premium Prize Bonds Draw
Prize bond draw is operated by a committee formed by CDNS and open to the general public. Winning prize bonds are drawn through a Hand-operated draw machine operated by special children in front of the general public and Committee members attending the draw ceremony.
The general public also checks the draw machine before the start of the draw. Video recordings of all draws are also stored in the record. CDNS issues the draw schedule for each denomination.
The Draws for each denomination of Premium Prize Bonds are operated every quarter. Draw for each denomination Premium Prize Bonds are held per the schedule below:
10th of March, June, September, and December every year.
The prize money for acquiring Premium Prize Bonds is attributed to the registered investor’s Bank account provided when buying the respective bond. Accordingly, the rate of WHT shall be decreased per the prevailing rates notified by the Federal Government.
Moreover, there are no charges for the prize money claim form for Premium PrizeBonds.