Fixed Deposit Rates in Nigeria

Posted by Felix Okoli on Friday October 18, 2013 at 12:35:5:

When it comes to investing money into banks in Nigeria, one of the best types of accounts that offer a good interest is the Fixed deposit account. Fixed deposit account normally have Fixed deposit rates attached to them and this is basically the interest rate which funds deposited into Fixed accounts tend to attract for the fixed period the money remains fixed and untouched.

In Nigeria, banks offer one of the best interest rates for fixed investment accounts in Africa and one thing is that there are over 20 banks in Nigeria but not all of them offer a uniform Fixed deposit rate.

One way to find out the Fixed deposit rate for banks in Nigeria is by visiting their official websites and viewing their daily rates being offered for fixed deposit accounts. While some of the banks have their rates published, others prefer to leave it open and only tell customers when they make inquiries. So you can just call the bank's customer service on phone and inquire on what their current rates are and the minimum deposit value. Fixed deposit rates may also be flexible for a particular bank and may appreciate if the investor is willing to bring a much higher capital.

Another way to find out what the fixed deposit rate is for banks in Nigeria is by reading the Deposit rates published by the Central bank of Nigeria which is made available on a periodic basis.

As at the time of writing this article, I managed to read a report from the CBN published on some of the dailies and this would at least give you an overview of what the deposit rates are for different banks in Nigeria.

Access bank = 7.69%
Citi Bank = 8.04%
Diamond bank = 10.50%
Ecobank = 9.40%
Enterprise Bank = 6.74
FCMB = 8.50%
Fidelity bank = 10%
First Bank of Nigeria = 8.49%
Heritage bank = 11.48%
Guaranty Trust Bank = 7.28%
Keystone Bank = 5.19%
Mainstreet Bank = 10.97%
Skye Bank = 8.23%
Stanbic IBTC = 9.78%
Standard chartered = 9.50%
Sterling Bank = 8.23%
Union Bank = 10.94%
United Bank for Africa = 9.29%
Unity Bank = 8.25%
Wema Bank = 9.28%
Zenith Bank = 8.50%

Note that these rates may change from time to time but at least gives you an insight on how different banks offer different rates for fixed deposit so that you know which one you'd like to invest in for the short term which is usually at most 1 year.

Are Fixed deposit accounts really a profitable investment in Nigeria? Well, I think they are given that some banks even pay up to double digit interest for one's investment. It may not earn much money but it is reliable money that grows your account from time to time passively even if one is not involved in any full time business. An investment of N10m can earn N1m a year if the interest rate is at least 10%.

Are there any taxes on Fixed deposit interest? Well, yes and it is basically a small tax called Withholding tax which the government requires all banks to deduct before paying the investor. In Nigeria, the rate of Withholding tax is at about 10% meaning that if someone earns about N1m from a Fixed deposit investment, the net amount he would actually be paid would be N900k.

Re: Fixed Deposit Rates in Nigeria Posted by mr wasiu oloyede on Saturday October 19, 2013 at 5:41:30:

may God bless you sir,apart from fixed deposit account,which type of other investment is risk free in nigeria banks.

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