To encash a regular bearer Prize Bond in Pakistan, present the original bond through an authorized encashment channel. National Savings currently says bearer Prize Bonds can be encashed through SBP Banking Services Corporation offices, National Savings Centers and designated commercial bank branches. The purpose of encashment is to receive the bond’s face value.
The most important distinction is this:
Encashing a Prize Bond = receiving the face value printed on the bond.
Claiming a prize = receiving prize money because that bond number won in an official draw.
These are two different transactions.
For example, encashing a Rs.1,500 Prize Bond means receiving Rs.1,500 back. If the same bond has won Rs.3,000,000, claiming that Rs.3,000,000 is a prize claim, not ordinary encashment.
Encashment vs Prize Claim
| Encashment | Prize Claim |
|---|---|
| Returns the bond’s face value | Pays a winning prize |
| Example: Rs.1,500 bond → Rs.1,500 | Example: winning Rs.1,500 bond → applicable prize money |
| Does not depend on the bond winning | Requires a winning number from an eligible draw |
| Face-value refund is separate from prize-money tax | Prize money is subject to applicable withholding tax |
| Uses an encashment request/process | Uses the prescribed prize claim procedure where required |
| Ends your holding of that bond | Concerns prize entitlement from a draw |
If your bond has won, read How to Claim a Prize Bond before deciding what to do with the physical bond.
Where Prize Bonds Can Be Encashed
National Savings currently states that regular Prize Bonds may be purchased and encashed through:
- SBP Banking Services Corporation field offices
- National Savings Centers
- designated commercial bank branches
Its current FAQ says the basic encashment procedure is to present the original Prize Bond at an authorized counter and receive its face value.
SBP also maintains a current National Prize Bond purchase/encashment form, confirming that encashment remains an official transaction handled through the authorized system.
Do not rely on an informal broker or private buyer when you specifically want official face-value encashment.
Documents You May Need
For ordinary bearer Prize Bond encashment, take at least:
- the original Prize Bond
- your valid CNIC
- a copy of the CNIC where required
- bank account details if the office processes the amount through bank credit
The current SBP National Prize Bond application asks for the holder’s name, CNIC, mobile number and bond details. The form also provides fields for bank-account information for encashment and states that a copy of a valid CNIC should be attached.
Requirements can vary depending on the transaction and the office handling it, so carrying your original CNIC as well as a photocopy can avoid an unnecessary second visit.
How Bearer Prize Bond Encashment Works
The regular Rs.100, Rs.200, Rs.750 and Rs.1,500 National Prize Bonds are bearer instruments.
For a normal face-value encashment:
- Take the original bond to an authorized encashment location.
- Complete the purchase/encashment application if requested.
- Provide your CNIC details and supporting identification.
- The bond is checked for genuineness and condition.
- The face value is paid according to the authorized payment procedure.
For example, if you submit:
- five Rs.1,500 bonds = Rs.7,500 face value
- ten Rs.750 bonds = Rs.7,500 face value
- twenty Rs.200 bonds = Rs.4,000 face value
your total face-value encashment would be Rs.19,000.
This calculation has nothing to do with whether those bonds previously participated in draws.
How Premium Prize Bond Redemption Works
Rs.25,000 and Rs.40,000 Premium Prize Bonds are different from bearer bonds because they are registered in the investor’s name.
SBP’s official Premium Prize Bond FAQ says a registered investor may encash Premium Prize Bonds when required through the office of issue. The face value can be credited to the investor’s registered bank account.
The current Premium Prize Bond encashment form requires, for encashment:
- copy of a valid CNIC, SNIC, NICOP or POC
- original Premium Prize Bond signed on the reverse
The form also states that face value may be credited to the bank account recorded for the investor.
Premium Prize Bonds therefore should not be treated as anonymous bearer instruments.
See Premium Prize Bonds for the separate rules covering Rs.25,000 and Rs.40,000 registered bonds.
Can You Encash a Winning Prize Bond?
A winning bond involves two separate values:
- face value of the bond
- prize money attached to the winning number
Do not assume that encashing the bond automatically completes the prize claim.
National Savings treats the prize claim procedure separately from ordinary face-value encashment. Prize claims require the winning bond and prescribed claim procedure, while normal encashment is simply the return of face value.
If you discover that your bond has won, first determine how its prize should be claimed.
Should You Claim the Prize Before Encashing?
Yes, this is the safer practical order for a bearer bond that you know has won: complete the prize claim procedure before treating the instrument as an ordinary bond for encashment.
The physical winning bond is evidence used in the prize claim process. Depending on the prize and applicable procedure, the bond may be retained or otherwise processed by the authorized office.
For Premium Prize Bonds, SBP’s form specifically states that transfer of a prize-winning bond is allowed only after outstanding prize money has been settled in the registered investor’s account.
For forms used in prize claims, see the Prize Bond Claim Form.
What If the Bond Is Damaged?
A damaged bearer bond does not always follow the simple counter-encashment process.
SBP provides a specific form, PB-1-A, for payment of the face value of mutilated or defaced Prize Bonds.
The Prize Bonds Refund Rules state that a claim may be considered where the submitted portion can be established as part of a genuine bond. A claim for a bond that is lost, wholly destroyed, or where no more than half of the bond remains is not entertained under those refund rules.
Do not trim, tape excessively, alter or further damage a questionable bond. Take what remains of it to the authorized office for examination.
For a completely missing bearer bond, see Lost Prize Bond because the rules are very different from those for a registered Premium Prize Bond.
Can Another Person Encash It?
Regular National Prize Bonds are bearer instruments, meaning possession of the instrument is central to their nature. National Savings specifically explains that ownership of a bearer Prize Bond belongs to the holder in a manner comparable to currency notes.
However, official encashment transactions now involve identification and application requirements, so a person presenting bonds should be prepared to provide the information requested by the authorized office.
Premium Prize Bonds are different. They are registered in the investor’s name, and their redemption must follow the registered-bond procedure. SBP also publishes a separate PPB-9 authorization form for specific representative-related Premium Prize Bond transactions.
Do not apply bearer-bond rules automatically to a registered Premium Prize Bond.
Is There Any Tax on Face-Value Encashment?
Prize-money withholding tax and face-value encashment are different matters.
SBP’s Prize Bond guidance specifically distinguishes the principal amount from prize money and states that tax is deducted on prize money rather than the principal amount.
So if you encash an ordinary Rs.1,500 bond for Rs.1,500, that transaction is a return of the bond’s face value.
By contrast, if that bond wins a prize, the prize money is subject to the applicable withholding-tax rules.
This distinction is another reason not to confuse encashment with a prize claim.
What Happens During a Shut Period?
The shut period applies mainly to the sale and draw eligibility cycle of a denomination.
National Savings currently defines the shut period as the 60 days before a draw, during which SBP and other authorized organizations stop selling Prize Bonds of that denomination. It also states that a bond must have been issued at least 60 days before the draw to qualify for that draw.
A shut period should not be confused with a ban on ordinary encashment. SBP’s Prize Bond FAQ separately states that Prize Bonds can be encashed after purchase and identifies authorized offices for sale and encashment.
In simple terms:
Shut period affects sale for the coming draw. It does not turn ordinary face-value encashment into a prize claim.
Before You Encash
First check what you actually want to receive.
If you simply no longer want to hold a Rs.100, Rs.200, Rs.750 or Rs.1,500 bearer Prize Bond, official encashment means returning it through an authorized channel and receiving its face value.
If the bond has won, deal with the prize claim separately before giving up the instrument. And if you hold a Rs.25,000 or Rs.40,000 Premium Prize Bond, use the registered Premium Prize Bond redemption procedure rather than treating it as a normal bearer bond.
FAQs
Can I encash a Prize Bond at National Savings?
Yes. National Savings currently lists National Savings Centers among the authorized places where regular Prize Bonds can be encashed. SBP BSC offices and designated commercial bank branches are also listed.
Do I get more than the face value when encashing a Prize Bond?
No. Ordinary encashment means receiving the bond’s face value. Any prize money that the bond has won is a separate claim.
Can I encash a Prize Bond at any time?
SBP’s official FAQ states that a Prize Bond can be encashed after purchase. The shut period relates to sale and draw eligibility rather than changing the basic meaning of encashment.
Do I need a claim form to encash a non-winning bond?
A prize-money claim form is not the same as the National Prize Bond purchase/encashment application. SBP maintains separate official forms for these transactions.
What happens to a damaged Prize Bond?
Damaged or mutilated bearer bonds may require examination and the PB-1-A refund procedure. A lost or wholly destroyed bearer bond is treated differently.