Every single market that exists in the world caters to the needs of every class in the best way possible. The same rule applies to the financial market as well. Within the financial instruments are categories and sub-categories that respond to different needs of various classes.
Prize Bond is one of the financial instruments, that is issued in series and is a bearer type of security available in different denominations of Rs. 200, Rs.750, Rs. 1,500, Rs. 7,500, Rs. 15,000, Rs. 25000 and Rs. 40,000. There is no fixed interest payment but draws occur on quarterly basis.
The prize bond that provides exclusive rights to its holder is called the Premium Prize Bond. These bonds are bought by usually the upper class because of its higher denomination. They are available for as high as Rs. 40,000 but the Government of Pakistan is planning to introduce a Premium bond for Rs. 100,000 as well.
What is so different about Premium Bonds than the regular ones?
The difference is apparent in two folds. Firstly, they carry an additional feature of earning 3% interest annually over and above the probability of winning a Prize. Secondly, the prizes are huge! There is one first prize for Rs. 80 million, three second prizes for Rs. 30 million each and 660 prizes for Rs. 0.5 million each.
What is the procedure for acquiring Premium bonds?
The procedure is similar as buying a regular bond. Premium bonds are available only in big cities of Pakistan i.e. in Karachi, Lahore, Islamabad, Peshawar and Quetta. One should follow the steps mentioned below to become the rightful holder of a premium bond.
- Fill the required application form for Premium bond,
- Show the account maintenance certificate of your bank account in the same city as where you are purchasing the bonds,
- Show the International Bank Account Number (IBAN),
- Submit a copy of CNIC,
- Submit all the important identity verification documents as previously mentioned including FBR Filer certificate along with the application form to the State Bank of Pakistan.
Why invest in Premium Prize Bonds?
The incredible features of Premium Bonds make it extremely attractive for a common person. These features include:
- You can earn up to Rs. 80 million that can simply change your life. Even though the probability is low, it is worth taking a chance.
- If you win any of the draws, the amount is directly credited to your account. This makes it a hassle free investment.
- Once you have bought the bond, you will begin to earn 3% interest which is directly sent to your account.
- There is no risk. Your investment is secure, even if you don’t win a prize.
Premium Bond is one of the very few investment opportunities that can increase your return by 50x folds. With a simple procedure and with literally zero risk at stake, it is a great investment option. So do try your luck! May the odds be in your favor.
Also see, Are Premium Bonds Really Premium?