Rs. 750 Prize Bond

Historical Context

Prize Bonds in Pakistan date back to 1960, introduced by the Government of Pakistan to:

• Mobilize small savings from the public.

• Offer an alternative to hoarding cash or jewelry.

• Reduce reliance on high-interest borrowing from external lenders.

The Rs. 750 denomination became popular because it was affordable for middle-income and lower-income families — giving them a lottery-like chance without losing their principal.

How They Fit into Pakistan’s Financial System

Prize Bonds are:

• Issued by the Central Directorate of National Savings (CDNS).

• Managed by State Bank of Pakistan (SBP).

• Widely available at scheduled banks, National Savings Centers, and SBP counters.

The government uses the funds collected to finance its budget deficit, meaning when you buy a prize bond, you’re technically lending money to the government interest-free in exchange for the chance to win prizes.

Prize Structure (Rs. 750)

As of 2025:

Prize	Amount (PKR)	Number of Winners
1st	1,500,000	1
2nd	500,000	3
3rd	9,300	1,696

This means every draw distributes millions in tax-free prizes.

Frequency: Draws are held 4 times a year (quarterly) — usually in different cities to promote transparency and inclusivity.

Draw Mechanism

• Conducted by the State Bank using a Hajj balloting machine (manual lottery ball machine) under the supervision of a committee.

• Process is open to the public and media for credibility.

• Results are published by the National Savings website, newspapers, and authorized banks.

Each bond has a unique serial number — if your number is drawn, you win that prize.

How to Buy & Redeem

How to Buy:

• Buy from any authorized branch of a commercial bank, National Savings Center, or SBP BSC office.

• No documentation needed for traditional bearer bonds — you just pay cash and get the physical bond.

How to Redeem:

• You can encash at face value anytime.

• To claim a prize, fill a claim form with the winning bond attached, your CNIC copy, and submit it at a SBP branch or National Savings office.

Withholding Tax

• Prize money is tax-free under normal income tax, BUT there is advance withholding tax:

  • 15% for filers

  • 30% for non-filers

• So if you win Rs. 1,500,000, you’ll receive it minus tax.

Popularity & Social Impact

Why people love it:

• It’s seen as a “safe gamble” for the masses — especially salaried people and pensioners.

• Culturally embedded: Many people gift prize bonds at weddings or as Eidi.

• Some people build up large portfolios hoping for “one big win”.

It’s informal saving — many don’t use banks for deposits, but hold bonds at home like cash.

Criticism & Problems

Prize Bonds are also controversial:

• Often used for parking undocumented money because bearer bonds don’t have names.

• Used in Hundi/Hawala and money laundering.

• The FATF (Financial Action Task Force) pressured Pakistan to phase out large denominations for this reason.

• No guaranteed return — people may hold for years without winning anything.

Recent Reforms

• The government discontinued big denominations (Rs. 40,000, Rs. 25,000, Rs. 15,000) in recent years — encouraging people to shift to Premium Prize Bonds, which are registered to your CNIC and pay bi-annual profit + prize draws.

• The Rs. 750 remains bearer-type, but some experts expect it may eventually be phased out or converted to registered form too.

Pros & Cons

Advantages	Disadvantages
Principal is safe	No guaranteed profit
Tax-free prizes	Low odds of winning
Easy to cash anytime	Risk of theft if kept at home
Simple no paperwork	Prizes reduced by withholding tax
Culturally accepted	Sometimes used for illicit money parking

Tips for Small Investors

Always buy from a bank/National Savings — avoid buying second-hand bonds from brokers.
Keep your prize bond safe — no name means if you lose it, anyone can cash it.
Check results immediately after each draw — there’s a 6-year limit for claiming prizes.
Consider mixing your savings — don’t park all your money in prize bonds. Use bank deposits or Premium Prize Bonds for steady returns too.

Fun Fact

According to National Savings data, billions of rupees in prize money go unclaimed every year — because people lose their bonds, forget to check results, or don’t know the claim process.

Where it’s going

Going forward:

• The government wants more people to shift to Premium Prize Bonds and registered saving schemes to formalize the economy.

• But Rs. 750 and Rs. 1,500 Prize Bonds remain the most popular among common people, who see them as their “hope ticket”.

Bottom Line

The Rs. 750 Prize Bond is:

• A small saver’s lottery backed by the government.

• Part of Pakistan’s parallel, informal savings culture.

• Popular for its simplicity and dream factor.

• Criticized for tax evasion loopholes.

• Slowly evolving towards more transparent, registered savings options.