(MENAFN - Khaleej Times) As much as its clients see a brighter future thanks to its savings programmes, National Bonds Corporation is looking at a similar prospect as it looks to further advance its growth this year, riding high on a very encouraging 2013 and positive sentiments in the UAE and the wider region.
The company, a pioneer via its first-of-its-kind Shariah-compliant Mudaraba-based savings scheme, plans to rev up its focus on educating the public and raising awareness on the importance of saving up for the future, its top official said.
"We believe such awareness will lead to the community adopting an even more regular habit of saving and making it an integral part of their everyday lives," Mohammed Qasim Al Ali, chief executive officer of National Bonds Corporation, told Khaleej Times in an interview.
"This will ensure the fulfillment of our mission to offer a secure, rewarding and memorable savings experience for the community."
Al Ali, appointed CEO in 2008, is at the forefront of National Bonds' growing portfolio of enterprises, as well as the development of innovative savings schemes.
So far, all of his efforts have paid off; not only for the corporation, but more importantly for its clients.
"We have created a wide range of diverse tools to encourage our bondholders to develop a savings habit," he said. "We have observed a significant increase in the number of people that showed interest in our savings programmes [last] year compared to 2012."
National Bonds' total percentage of bondholders reached a seven per cent increase in 2013 compared to the previous year. And to make it sweeter for everyone, the company gave away over 510,000 prizes last year.
"We are very optimistic about sustaining and advancing our growth curve in 2014. [Last] year showed potential and helped in fulfilling our initial vision of inculcating a savings culture in the region," Al Ali said, pointing to two major factors influencing National Bonds' bullishness: more positive growth in store for the UAE and Dubai's victory in World Expo 2020.
Making it better
One of National Bonds' strategic goals is its commitment towards improving the savings culture in the UAE. Last year was a very productive year for the company, and 2014 will see more initiatives come to fruition.
While developing strategies is one thing, implementing these is another; National Bonds has periodically conducted surveys to identify people's attitudes towards achieving the objective of instilling a savings culture in them. It launched the National Bonds Savings Index in 2011 with the aim of providing a comprehensive study on the saving and spending habits of people in the GCC, which highlighted that the primary factor taken into consideration when choosing a savings instrument was its conformity to Shariah principles.
"These surveys help up gain an understanding of what obstacles people face in developing a regular savings habit," Al Ali said. "Based on the feedback we received... we decided to shift the focus of our rewards structure towards helping our bondholders fulfill their needs in 2013. This small step has helped us reap rich dividends."
And thanks to the index, National Bonds has several initiatives in the pipeline. Al Ali says that the company is confident that the index will stimulate public opinion and encourage organisations to seek solutions for developing a sustained savings habit among employees,
"It has been equally gratifying to hear from our customers that the new structure has helped them achieve their dreams. Other strategies such as the financial well-being initiative, as well National Bonds' participation in the country's prominent human resource summits have helped us promote our ongoing Emiratisation drive and internal CSR initiatives and employee savings programmes across the UAE."
Al Ali pointed out that National Bonds is planning to improve its Employee Savings Programme and promote in consistently throughout 2014, "to make sure that the majority of the UAE's employees save for their future well-being and for their families".
"We were happy to partner with a number of private and public organisations that went the extra mile with us through our Employee Savings Programme," he said. "It helped their employees plan their financial affairs; the direct salary deduction initiative helped in spreading the savings culture, which had a positive impact on the economic health of the UAE."
As with any other activity, saving up is an exercise in responsibility and discipline. Al Ali, having the expertise of the ins and outs of it, offered some advise.
"To build financial responsibility and security, you must first know how much money you have coming in and how much you have going out. The 'going out' must include your own savings. Listing your savings as an expense, just as you would any other bill, is a great way of enforcing the habit of saving and incorporating it into your monthly expenditure," he said.
"Ideally, a person should save a minimum of 10 per cent of their monthly income and have at least three months of salary in their bank accounts. Unfortunately, most people are not consistent about following such margins. So 10 per cent may be unrealistic, but the important point is to start with something. Saving is usually easier than it seems once you set your mind to it."
He stressed that one of the most common mistakes committed is "living in an illusion of financial security", and the lack of proper planning as a result.
"The truth is we never know when we may lose our jobs or when economic crises might strike again. When we are faced with such situations, the brighter picture would be to have enough savings to guarantee a decent living standard, as opposed to realising that we are left not only penniless but also in debt," Al Ali said.
"Think of your goals, especially the long-term ones. Whatever they are, you will reach them sooner by starting to save now. Saving not only helps fulfill your responsibilities to yourself and family, it also builds security and ensures your peace of mind."