₦airaland Forum

No bank on earth can pay you this amount for a month, it must be for a year, you must have fixed it for a year, so they paid you upfront, you better ask them

waleadex:
I got #85,000 on #1,000,000 last October so I know what I am saying madam...

duni04:
10% in 365 days??! When you can make10% in 1 day on equities. Only really ignorant people still subscribe to fixed deposits.

10% a day on equities. Chai Nigerians and tales. I prefer to be ignorant please. She was recommending what an average person can do and will succeed in doing. You my friend have just staked your reputation. Now retract and say sorry.

OP did a nice work marred by errors. No wonder some students write on all the pages of their answer scripts and still fail the exam.

Reference:
No. I don't think the poster is absolutely correct about exactly how much accrues to you. The tenor is different from the rate. All interest is estimated P.A. Tenors can be 2 minutes for all they care.

The tenor on FD really does matter. Mind you, FD is not not the same with Call Deposit.

DonDiego:
On the other hand you could also easily lose 10% a day in the equities market esp in these endless bearish days.

U never lose money in equities. You buy a stake in a company and if the company does well, the price climbs and you sell higher. If it doesnt, you wait till the next quarter. Very simple. That's apart from the dividend they pay u.

@OP. You went about finding out comparable interest rates from different banks and therefore spending 5K in the process the wrong way. The CBN weekly publishes the interest rates offered for all kinds of deposits by all Nigerian banks in the newspapers and on its website. All you needed to have done was to get a copy of Businessday newspaper for 200 naira and your questions would have been instantly and more comprehensively answered.

Bros pls get the computation right:
7% interest of N500,000 for 60day is computed thus;
0.07 x 500000 x 60\365
= N5,753.425

What u assumed for 60days for 1year ie 365 days.

Thanks

% is per annum n not per no of dayz (7,30,60,90,180,etc). ask for more clarification

duni04:
U never lose money in equities. You buy a stake in a company and if the company does well, the price climbs and you sell higher. If it doesnt, you wait till the next quarter. Very simple. That's apart from the dividend they pay u.

It all depends on the principal you are bringing in. Note, you said IF the company does well. It's still a risk. The beauty of investment is that, there is something for everyone.

You are wrong in your calculation, 9/12*2=1.5%for 2months which is 60days

ednut1:
Op u shud know d interest are per annum o. For d 60 days. If d bank offer 9%. It means 9% divided by 365 days times 60. Which equals 0.85%.

duni04:
10% in 365 days??! When you can make10% in 1 day on equities. Only really ignorant people still subscribe to fixed deposits.

I am sure you know enough investment theories to understand the higher results go with high risks too.

What makes a savvy investor is a strong portfolio, a good mix of investments. short term investments is good for liquidity, your equities take T+2 days to yield cash at the minimum.

garrimallam:
Bros pls get the computation right:
7% interest of N500,000 for 60day is computed thus;
0.07 x 500000 x 60\365
= N5,753.425

What u assumed for 60days for 1year ie 365 days.

Thanks

Ok

naijacutee:
Last month, I happened upon some money from an old investment which had matured. Rather than have it collect “one one naira” in my standard savings account, I decided not to be the fly that follows the corpse to the grave, and put it in a fixed deposit. Fixed deposits are a very popular investment option in Nigeria, and you’ll hear about them 8 times of out 10 if you do happen to ask for advice regarding how to invest money. The attraction to this sort of investment is that returns are guaranteed, and the duration of your investment is flexible. We probably like this sort of investment because they help us mitigate risks – in a country where nothing is guaranteed, we don’t tend to tie money down in long term investments and fixed deposits are the perfect solution to this investment problem. In the course of my search for a decent return on my investment, I “burnt” at least N5,000 in credit, calling banks and waiting in queues for information, and was only able to reasonably compare two banks – GTBank and First Bank.

What is a fixed deposit?
A fixed deposit is a lump sum deposited with a bank for a varying period, in exchange for interest.
How to put your money in a fixed deposit: You will need to have an existing account with the bank of your choice, and then you deposit the sum into this account. You will then need to inform your bank of your intention to “fix” the said sum for “X” number of days. It is very important that before you make your decision, that you shop around for the best rates. You are not obliged to fix your money with your existing bank, just because you bank with them. You can earn a significantly higher amount by just picking up the phone. It is the more difficult route when you consider call waiting times, credit spent etc but it is worth it, and what’s more I have done some of this hard work for you.

How long is my money fixed for?
Most banks offer flexible periods of 30 days, 60 days, 90 days, 180 days and one year.

How do I get paid?
Usually, the money is removed from your account and the interest is paid into your account. So for example, you want to fix N500,000 for 60 days and the bank has offered you an interest rate of 7%. You have N550,000 in your account. Once you confirm you’re making the arrangement and sign all the necessary documentation, the N500,000 “disappears” from your account to be “fixed”. At the end of 60 days, you get paid back your original N500,000 + an additional N35,000 interest accrued. A simplified version of what really happens behind the scenes is that the N500,000 is given to another customer who has asked for a loan – but he will be charged 20% interest (or N100,000). After 60 days, you get back your N500,000 + N35,000 (7% interest from the other customers N100,000). Not bad business for banks, if you ask me.

Bank interest rate comparisons
For my enquiries, I called First Bank and GTBank.
I rated both banks on customer service quality (pet peeve of mine, because time is money) and interest rates.
tbankvsfirstbank

Interest rates
First Bank
7 days (First bank does not offer this service)
30 days – 9.25%
60 days: 9.50%
90 days: 9.75%
365 days: 10%
GTBank
Available from N100,000 to N1m.
7 days – 3.75%
30 days – 180 days : 6.25%
Some notes:
Call times. My initial contact with both banks was on a Friday afternoon, at about 5.30pm. My second contact attempt with GTBank after the first one proved futile was at 3.20pm on a Sunday.
Omissions. I initially wanted to include Accessbank in this exercise, but have been unlucky in getting through to a knowledgeable person on customer service. The frontline staff I have spoken to, all seem to lack basic knowledge regarding what services their banks offer and where to get information outside the limits of their knowledge. I would recommend that training is provided for all front line staff as a matter of urgency, as customers otherwise have no way of getting informed about competitive rates for your most lucrative services.
Am I an agent? I work for neither of these banks. My selection of this two is purely by chance and accessibility of contact information via the bank websites. I simply picked the banks with the most prominent contact information via websites. My reviews are unbiased, and if I haven’t reviewed any others yet, don’t worry – “life is turn by turn”.

Courtesy: http://www.mrpepe.com/banking/which-is-the-best-account-for-a-fixed-deposit-gtbank-or-firstbank/

thanks bros. I really need it. Dts Wat I want to do next year bt I was ve nt investigate on display bank dt is d best 2 do it. pls research on oda banks let us know.

Ebenezerk2:
No bank on earth can pay you this amount for a month, it must be for a year, you must have fixed it for a year, so they paid you upfront, you better ask them

Even for one year, he still wouldn't get up to 85k. Gone are the days (before Sanusi became the CBN Governor) when FD rates were juicy and appealing.

korel9:
@ Op, nice thread but no hating intended. Don't you think I'll earn more than that rate if I invest my money in a quick business within d 30days period?

Yes but the risk in them biz is way higher than that of Banks

Fabdedon:
i appreciate!!

Or you could make 50% interest on Chelsea and Barcelona winning this afternoon and the tenor is just 90 minutes.....oh Bleep...bloody John Terry has done my investments in....

GTBank interest is not fixed. It varies with d amount you are fixing. Stop misleading people. 6.25% is for 100k - 1Million. The higher u go, the more d interest.

The interest rates for all tenures are per annum. The bank will not give you 35k for handling your money for 60 days. What happens is that you get a percentage of the annual interest that depends on the tenure of the investment, i.e. for a 60 day tenure, the annual interest is 35000/6, for a 180 day tenure, the interest accruable to you is 35000/2. There are still some tiny charges for VAT, taxes etc but they are usually small potatoes.

naijacutee:
Last month, I happened upon some money from an old investment which had matured. Rather than have it collect “one one naira” in my standard savings account, I decided not to be the fly that follows the corpse to the grave, and put it in a fixed deposit. Fixed deposits are a very popular investment option in Nigeria, and you’ll hear about them 8 times of out 10 if you do happen to ask for advice regarding how to invest money. The attraction to this sort of investment is that returns are guaranteed, and the duration of your investment is flexible. We probably like this sort of investment because they help us mitigate risks – in a country where nothing is guaranteed, we don’t tend to tie money down in long term investments and fixed deposits are the perfect solution to this investment problem. In the course of my search for a decent return on my investment, I “burnt” at least N5,000 in credit, calling banks and waiting in queues for information, and was only able to reasonably compare two banks – GTBank and First Bank.

What is a fixed deposit?
A fixed deposit is a lump sum deposited with a bank for a varying period, in exchange for interest.
How to put your money in a fixed deposit: You will need to have an existing account with the bank of your choice, and then you deposit the sum into this account. You will then need to inform your bank of your intention to “fix” the said sum for “X” number of days. It is very important that before you make your decision, that you shop around for the best rates. You are not obliged to fix your money with your existing bank, just because you bank with them. You can earn a significantly higher amount by just picking up the phone. It is the more difficult route when you consider call waiting times, credit spent etc but it is worth it, and what’s more I have done some of this hard work for you.

How long is my money fixed for?
Most banks offer flexible periods of 30 days, 60 days, 90 days, 180 days and one year.

How do I get paid?
Usually, the money is removed from your account and the interest is paid into your account. So for example, you want to fix N500,000 for 60 days and the bank has offered you an interest rate of 7%. You have N550,000 in your account. Once you confirm you’re making the arrangement and sign all the necessary documentation, the N500,000 “disappears” from your account to be “fixed”. At the end of 60 days, you get paid back your original N500,000 + an additional N35,000 interest accrued. A simplified version of what really happens behind the scenes is that the N500,000 is given to another customer who has asked for a loan – but he will be charged 20% interest (or N100,000). After 60 days, you get back your N500,000 + N35,000 (7% interest from the other customers N100,000). Not bad business for banks, if you ask me.

Bank interest rate comparisons
For my enquiries, I called First Bank and GTBank.
I rated both banks on customer service quality (pet peeve of mine, because time is money) and interest rates.
tbankvsfirstbank

Interest rates
First Bank
7 days (First bank does not offer this service)
30 days – 9.25%
60 days: 9.50%
90 days: 9.75%
365 days: 10%
GTBank
Available from N100,000 to N1m.
7 days – 3.75%
30 days – 180 days : 6.25%
Some notes:
Call times. My initial contact with both banks was on a Friday afternoon, at about 5.30pm. My second contact attempt with GTBank after the first one proved futile was at 3.20pm on a Sunday.
Omissions. I initially wanted to include Accessbank in this exercise, but have been unlucky in getting through to a knowledgeable person on customer service. The frontline staff I have spoken to, all seem to lack basic knowledge regarding what services their banks offer and where to get information outside the limits of their knowledge. I would recommend that training is provided for all front line staff as a matter of urgency, as customers otherwise have no way of getting informed about competitive rates for your most lucrative services.
Am I an agent? I work for neither of these banks. My selection of this two is purely by chance and accessibility of contact information via the bank websites. I simply picked the banks with the most prominent contact information via websites. My reviews are unbiased, and if I haven’t reviewed any others yet, don’t worry – “life is turn by turn”.

Courtesy: http://www.mrpepe.com/banking/which-is-the-best-account-for-a-fixed-deposit-gtbank-or-firstbank/

The interest rate is annualized (ie per annum). Also note that whatever accrued interest would be taxed (withholding tax) by 10%.

Reference:
Or you could make 50% interest on Chelsea and Barcelona winning this afternoon and the tenor is just 90 minutes.....oh Bleep...bloody John Terry has done my investments in....

Kalokalo tinz

naijacutee:
Last month, I happened upon some money from an old investment which had matured. Rather than have it collect “one one naira” in my standard savings account, I decided not to be the fly that follows the corpse to the grave, and put it in a fixed deposit. Fixed deposits are a very popular investment option in Nigeria, and you’ll hear about them 8 times of out 10 if you do happen to ask for advice regarding how to invest money. The attraction to this sort of investment is that returns are guaranteed, and the duration of your investment is flexible. We probably like this sort of investment because they help us mitigate risks – in a country where nothing is guaranteed, we don’t tend to tie money down in long term investments and fixed deposits are the perfect solution to this investment problem. In the course of my search for a decent return on my investment, I “burnt” at least N5,000 in credit, calling banks and waiting in queues for information, and was only able to reasonably compare two banks – GTBank and First Bank.

What is a fixed deposit?
A fixed deposit is a lump sum deposited with a bank for a varying period, in exchange for interest.
How to put your money in a fixed deposit: You will need to have an existing account with the bank of your choice, and then you deposit the sum into this account. You will then need to inform your bank of your intention to “fix” the said sum for “X” number of days. It is very important that before you make your decision, that you shop around for the best rates. You are not obliged to fix your money with your existing bank, just because you bank with them. You can earn a significantly higher amount by just picking up the phone. It is the more difficult route when you consider call waiting times, credit spent etc but it is worth it, and what’s more I have done some of this hard work for you.

How long is my money fixed for?
Most banks offer flexible periods of 30 days, 60 days, 90 days, 180 days and one year.

How do I get paid?
Usually, the money is removed from your account and the interest is paid into your account. So for example, you want to fix N500,000 for 60 days and the bank has offered you an interest rate of 7%. You have N550,000 in your account. Once you confirm you’re making the arrangement and sign all the necessary documentation, the N500,000 “disappears” from your account to be “fixed”. At the end of 60 days, you get paid back your original N500,000 + an additional N35,000 interest accrued. A simplified version of what really happens behind the scenes is that the N500,000 is given to another customer who has asked for a loan – but he will be charged 20% interest (or N100,000). After 60 days, you get back your N500,000 + N35,000 (7% interest from the other customers N100,000). Not bad business for banks, if you ask me.

Bank interest rate comparisons
For my enquiries, I called First Bank and GTBank.
I rated both banks on customer service quality (pet peeve of mine, because time is money) and interest rates.
tbankvsfirstbank

Interest rates
First Bank
7 days (First bank does not offer this service)
30 days – 9.25%
60 days: 9.50%
90 days: 9.75%
365 days: 10%
GTBank
Available from N100,000 to N1m.
7 days – 3.75%
30 days – 180 days : 6.25%
Some notes:
Call times. My initial contact with both banks was on a Friday afternoon, at about 5.30pm. My second contact attempt with GTBank after the first one proved futile was at 3.20pm on a Sunday.
Omissions. I initially wanted to include Accessbank in this exercise, but have been unlucky in getting through to a knowledgeable person on customer service. The frontline staff I have spoken to, all seem to lack basic knowledge regarding what services their banks offer and where to get information outside the limits of their knowledge. I would recommend that training is provided for all front line staff as a matter of urgency, as customers otherwise have no way of getting informed about competitive rates for your most lucrative services.
Am I an agent? I work for neither of these banks. My selection of this two is purely by chance and accessibility of contact information via the bank websites. I simply picked the banks with the most prominent contact information via websites. My reviews are unbiased, and if I haven’t reviewed any others yet, don’t worry – “life is turn by turn”.

Courtesy: http://www.mrpepe.com/banking/which-is-the-best-account-for-a-fixed-deposit-gtbank-or-firstbank/

Don't be deceived, 35k accrued on 500k for 60 days is based on simple arithmetic which says that interest is per annum. In other words, if you fix 500k for 60 days i.e 2 months, what you'll get at the end of it is 35k divided by 12 and then multiplied by 2. So 500k will yield a lil below 6k for you in 2 months. And you'll be charged 10% of the interest too.
Quote me if u think I'm right or wrong...

If u say Gtbank z more of reatail banking, wot would u say abt Access,uba n co?

PerfumeRepublik:
GTB will fail in this ...they are more focused on retail banking.
Would have loved to see Diamond bank Vs First bank

naijacutee:
A simplified version of what really happens behind the scenes is that the N500,000 is given to another customer who has asked for a loan – but he will be charged 20% interest (or N100,000). After 60 days, you get back your N500,000 + N35,000 (7% interest from the other customers N100,000). Not bad business for banks, if you ask me.

The behind the scene is not as straightforward as u mentioned cos there are many other charges behind the scenes bank incure for every deposit. Such as 1% premium to NDIC for every deposit a customer make in the bank.

garrimallam:
Bros pls get the computation right:
7% interest of N500,000 for 60day is computed thus;
0.07 x 500000 x 60\365
= N5,753.425
What u assumed for 60days for 1year ie 365 days.
Thanks

Thanks so much bro, this is just how interest of FD is being calculated. Sone banks use 360days while others use 365days in a year. Accrued interest on FD is on a daily basis....u cant even get up to 35k on CBN treasury bill at 12% interest rate for 60 days not to talk of fixed deposit of 7%.


Fixed deposit business is always costly for all banks cos of interest expense payment and other behind the scenes payments and calculations. Those that profit much on this type of business are the people that invest millions of naira and the bank gain much only when they negotiated for a bit lower interest with the customer

waleadex:
I got #85,000 on #1,000,000 last October so I know what I am saying madam...

Which bank

Dalby:
The interest rate given is annual not monthly, so the calculations are wrong.
N500,000 at 7% means N35,000 / year.
for 30days i.e 1 month it is N35,000/12 since 12 months make a year N2,916.67. At the end of 30days you have N502,916.67.

bro i dnt tink ur calculation z right, do u knw how much interest i get monthly on my ordinary savings acc talk more of fixing dat amt 4 one whole year?

Ebenezerk2:
You are wrong in your calculation, 9/12*2=1.5%for 2months which is 60days

almost correct tho. It gives 1.47% nt. 85%

Franky9584:
bro i dnt tink ur calculation z right, do u knw how much interest i get monthly on my ordinary savings acc talk more of fixing dat amt 4 one whole year?

he is right bro. It makes no sense fixing for a month. D interest rates are per annum nt monrho. Hence it has to be prorated

D op analysis is quite wrong n misleading all fixed deposit rates r quoted per annum nt otherwise

@OP.... Your calculation is wrong.... The 7% is to be divided by 6 for 60days deposit. While 7days will be divided by 52, to make for 52 weeks in a year. So the 10% on 500k for two months will give 50k/6 = 8333. So please take note before you confuse your readers.

Op started on a good note but he got the calculation wrong, I won't dwell on that since some else has already corrected him.
 Fixed deposit are as safe as leaving your money in your account just that u can't touch it while  it's fixed.
CBN set a new MPR at 13% which means the highest interest a bank can give you is 13%.

The interest you get depends on 3 Factors
1) the amount you are fixing
2) the tenor( how long)
3) your negotiations with the bank.

Please it's not only banks that do fixed deposits, investment houses like Investment one financial services, ARM, kakawa discount house etc also do fixed deposit. Infact the rate the investment houses offer is fairly competitive to banks.

Investment houses are as safe as banks because the are now regulated by SEC and CBN the are also insured by NDIC, in addition they are required to have more than 50% liquidity to meet up with there customers. 

In my opinion banks may not give u nice rates because the always have money to do business, what I mean is some people just leave there cash idle in there bank account and banks will be doing business with it while investment house are desperate for money therefore are willing to offer u higher rates. For example I know an investment house who's interest rate ranges from 6.5% to 14%

Advice: instead of fixing your money for 90 days in banks and the will still charge u 10% withholding tax, why not buy treasury bills from CBN which comes with no withholding tax, the interest is paid upfront, it's very secured even more than banks and the rates are always higher than the inflation rate which is about 8% now



Disclaimer : Everything written here is my opinion not yours so keep your criticism to your self

While will I do 365 days: 10%
And get 30 days at 9.25%...

Won't I just keep repeating the 30 days option

abi, they won't allow me to keep fixing every 30days

this amateur post is quite interesting