Sales of national savings certificates soared 15.81 percent in the first two months of the fiscal year as people continue to park their funds in the instrument given the low interest rates at banks.

Sales of savings tools hit a record Tk 52,327 crore in fiscal 2016-17 -- overshooting the government target of Tk 19,610 crore.

The trend would continue this year if the government does not slash the rates on savings certificates, said a senior Bangladesh Bank official.

Banks are offering hardly 7 percent as interest rate on deposits whereas the rates offered by the national savings certificates are between 11.04 percent and 11.76 percent.

In the months of July and August, Tk 9,028.57 crore worth of savings instruments were sold, according to the Directorate of National Savings.

However, the high returns on the investment tool are pushing up the government's interest liability.

And the flood of money thanks to the investment tool is keeping the government away from borrowing from the banking system.

Last fiscal year, the government did not borrow from banks at all; rather, it paid back Tk 18,029 crore to banks against its borrowing of Tk 4,807 crore in fiscal 2015-16, according to data from the BB.