Classifieds powered by Gulf News

Saradha chit fund scam: investors backing government savings

Government shelves its proposal to float small savings scheme

Gulf News

Kolkata: Post the exposure of Saradha chit fund scam, small investors has reinvested their faith in government savings. Though the rate of return is not phenomenal, but investors have realised that security and peace of mind is a critical aspects when it comes to their hard earned savings.

In the month of May and June, Rs1.12 billion and Rs3.13 billion were invested in West Bengal in various small savings schemes floated by the government, which government officials believe is a result of investors understanding the importance of security of money above returns. “People have realised the importance of investing in government schemes rather than falling prey to various ponzi schemes.”

In comparison to last years, the figures of investment in the month of May and June were Rs90 and 160 million respectively.

Strangely the biggest beneficiary of this is Mamata Banerjee led state government which was believed could have suffered the most as a fall out of the scheme, especially when many of its elected representatives were seen having close links with Sudipto Roy, the promoter of Saradha Group, which went bust in April this year.

Not only Banerjee has been able to hold on to its rural vote and win 13 out of 17 districts in the recently concluded Panchayat elections, but it will also help the state government tide over the present financial crisis. “Though initially it was through to be a major embarrassment but finally it has become a boon for the government. The state can take a soft loan up to 100 percent from these schemes; the government is not liable to pay any interest for the first 5 years. In the last two years, the government were not able to borrow any funds and were paying interest on past loans,” said an official of the state finance department.

However, the state government had been forced to shelve the idea of floating its own savings scheme. Initially Banerjee had floated the idea, but considering the legal obligations and constitutional framework, it has been shelved, inform an official of the chief minister’s office. “Apart from legal hassles, the state government can do without running financial schemes,” the official added.

Though Banerjee was keen sighting that the rate of interest has been slashed by the central government and also commissions offered to the agents have been removed in various schemes floated by the Post and Telegraph department, the response from the people at large has been muted.

“We floated the idea on our web asking people give suggestions, but most of them were baseless or negative. Don’t think the chief minister will further push this,” said a senior bureaucrat.