Good News for Nigerians: GTB, Zenith, and Access Bank Increase interest on savings accounts
Nigerian Banks Raise Interest Rates on Savings Deposits Amidst Central Bank’s Policy Changes
As of July 2023, Nigerian banks have implemented an increase in interest rates on savings deposits in response to the Central Bank of Nigeria’s (CBN) recent adjustments to the Money Policy Rate (MPR). The CBN raised the MPR by 25 basis points, marking the sixth consecutive increase over the past 12 months, bringing it to 18.75% from the previous 18.50%. This move was aimed at curbing rising inflation and encouraging savings.
The MPR plays a crucial role in determining interest rates in the financial system, and as a result of the CBN’s policy changes, banks were required to adjust their minimum interest rates on savings account deposits to 30% of the MPR. The CBN announced this policy change, superseding its earlier directive from September 1, 2020, effective from August 1, 2022.
Several commercial banks, including Standard Chartered Bank and Stanbic IBTC, have already informed their customers about the upward revisions in interest rates on savings accounts. Standard Chartered Bank stated that credit interests are now calculated based on daily account balances, and customers are allowed a maximum of four withdrawals per month to qualify for interest payments. Meanwhile, Stanbic IBTC informed its customers that all its product offerings linked to the MPR would be adjusted in line with the new rate from July 25, 2023.
The recent changes have resulted in a record-high deposit rate of 5.18% as of June 2023, according to data from the CBN. This substantial increase reflects the impact of the higher MPR on interest rates across the banking industry. Remarkably, some banks, including Access Bank, Citibank, Fidelity, Heritage, Polaris, Premium Trust, Sterling Bank, Titan Trust, Unity Bank, Wema Bank, and Standard Chartered Bank, already pay their customers an average interest rate on savings deposits above the national average of 5.18%.
For instance, Standard Chartered Bank offers a competitive 5.31% average deposit rate, while Coronation Bank stands at 6.78%, and Ecobank at 4.65%. However, some banks, such as FCMB, Globus Bank, Stanbic IBTC, and SunTrust, offer relatively lower interest rates on savings deposits. Nevertheless, these rate adjustments have positively impacted customers looking to grow their savings with higher returns.
As the monetary landscape continues to evolve, it is essential for customers to stay informed about changes in interest rates and carefully choose banking options that align with their financial goals. With the Nigerian banking sector witnessing ongoing policy shifts, customers may want to explore various banks’ offerings to optimize their savings potential in light of the current interest rate climate.
