Govt mulls over launching digital prize bonds

The government is expected to launch digital prize bonds, which will be transacted through a mobile application and credited directly to linked bank accounts or Central Directorate of National Savings (CDNS) accounts at the time of purchase.

According to reports, the prize money from these bonds will be subject to taxation but exempt from Zakat.

The initiative aims to improve economic documentation, transparency, and accountability while eliminating risks associated with physical bonds, such as theft, loss, or damage.

The transition to a paperless system is also anticipated to reduce printing and logistical expenses. As digital bonds will be registered under the buyer’s name, the risk of fraud will be minimized, making the buying, selling, and prize redemption processes more efficient.

Initially, the government will issue digital bonds in denominations of Rs500, Rs1,000, Rs5,000, and Rs10,000. Additional denominations may be introduced as needed.

Adult Pakistani citizens will be able to purchase these bonds through the National Savings mobile app or other authorized CDNS channels, using payments linked to bank or savings accounts.

Prize money will be credited directly to the investor’s account, with quarterly draws scheduled at the beginning of each calendar year.

Investors will also have the option to nominate beneficiaries at the time of purchase, with the flexibility to modify or cancel nominations later. In the event of the investor’s death, the original bond value and any prize money will be transferred to legal heirs based on a succession certificate.

If the total amount is Rs500,000 or less, the nominated person will receive the payment directly.