Lending Money To The Government.

Discussion in Loans started by ptahm22 • Jan 27, 2017.

  1. ptahm22

    ptahm22Active Member

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    Our country is introducing a system where citizens can lend money to the government. You can lend as little as $30 and be paid at an interest rate higher than when you just save money in the bank. It's being perceived as an investment to help the public to diversify their income. Would you lend money to the government?
     
  2. Ray1

    Ray1Well-Known Member

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    We have a number of such plans started by government for the purpose of nation building. For example, we have National saving Certificates issues by India Post with no maximum limit for deposit, no tax deduction at source but provides a tax rebate under a special provision. The scheme has a lock-in period and interest is compounded annually.
     
  3. Jamille

    JamilleActive Member

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    I am, in fact, a lender to the government as I am a holder of Treasury Bonds. I invested on these marketable securities through my bank and it earns so much more than my savings account and offers significantly higher interest than time deposits. In my opinion, It is a more secure way to invest as income is guaranteed. These bonds are on a five-year term and not subject to final taxes unlike interest from regular bank accounts that are charged 20% final tax.
     
  4. Nakitakona

    NakitakonaActive Member

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    I never heard about this scheme giving financial assistance to the government from a private person or agency in the local scene. What I have learned that the government is borrowing money from the International Monetary Fund or IMF. But for the local source, I know it is possible but I don't think it would create a conflict of interest. The lender would ask for a favor from the government to protect its business interest in return.
     
  5. Gad

    GadMember

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    I would welcome such a move by the government with both arms.What your government @Ptahm 22 is trying to do is to reduce cash balances held by the public.I understand its called fiscal policy in Economics.Its used to try and reduce the rate of inflation.

    Considering the fact that the returns will be better than depositing in banks,I would invest heavily on the scheme.It is a once opportunity.Do not let it slip.