Retail Government Sharia Securities (SBSN) are available in two types, namely Retail Sukuk (SR) and Savings Sukuk (ST).
Sukuk, also known as Sharia Bonds, are long-term securities that adhere to Sharia principles issued by the government to Sharia Bond holders. The government is obliged to pay returns to the holders and repay the principal at maturity. The invested funds will be used for activities to purchase the Benefit Right of State Property and then leased to the government to benefit from these activities.
Similarities between Retail Sukuk (SR) and Savings Sukuk (ST)
As both are Sukuk, there are similarities between SR and ST:
1. Sharia Principles
Both SR and ST adhere to sharia principles. This investment is suitable for investors who want to be exempted from gambling, uncertainty, and usury. They have also been ratified according to Sharia principles by the National Sharia Council - Indonesian Ulema Council (DSN-MUI).
2. Playing a Role in National Development
Funds received from Sukuk issuance will be used to finance national development.
3. Using a Wakalah Contract
The agreement requires the pillars and conditions to be in place, namely the principal, agent, and subject-matter of an agency.
4. Affordable Investment
Investments may be made with capital starting from Rp1 million.
5. Monthly Yield (served as passive income)
Yields are paid monthly until the maturity of the Sukuk. The return is guaranteed by the government under the law, making it safe from default.
So, what is the difference between Retail Sukuk (SR) and Savings Sukuk (ST)?
1. Investment Tenor
Reflecting on this year’s SR and ST, the tenors of the SR are 3 years & 5 years, while the ST is at 2 years & 4 years to suit the investor’s goals and timeframe.
2. Yield Type
A major difference in the use of yield rates lies in the type of interest rate used. In SR, the yield has a fixed rate. This means that the monthly yield payment will be the same from the beginning to the end of the tenor.
Meanwhile, ST yield is floating with floor. The yield payable may change according to the interest rate of Bank Indonesia (BI 7 Days Repo Rate). If the BI rate falls, the government has set the floor to ensure that the rate does not fall below what it was at the time of issuance.
3. Tradable vs Non Tradable
These two Sukuk types differ in their ownership characteristics. SR is a tradable Sukuk that can be traded back in the secondary market before maturity. Meanwhile, ST is non-tradable or cannot be traded in the secondary market. Investors need to wait until the maturity of the ST to get back their investment capital.
4. Capital Gain
Since SRs are tradable, investors can potentially reap capital gains/profits if the selling price is above the initial principal and capital losses when the selling price is below the initial principal. This is something that does not apply to STs. But, ST will earn higher returns if there is an increase in the BI rate.
5. Early Redemption Facility
Although ST cannot be traded, the government provide an early redemption facility, which allows you to withdraw your capital earlier after the investment has been running for one year. The maximum amount of capital that can be redeemed is up to 50% of the total investment.
The requirement to enjoy early redemption is a minus ST ownership of IDR 2 million. Investors who want to use their funds for other purposes can take advantage of this facility.
That concludes the information about the similarities and differences between SR and ST. Use the Welma feature on myBCA app, which can be downloaded from the Play Store and App Store to start investing. After downloading, immediately create Single Investor Identification for further investment transactions at myBCA and enjoy a variety of promos.