Fixed deposit interests are very appealing these days! Let’s see which of the banks provide highest fixed deposit interest rates in Nepal. Banks in Nepal are offering historically high interest rates on Fixed Deposits keeping in mind the various different financial aspects and current market economy in mind.
Most of the banks have the same fixed deposit as NRB has a cap on the maximum return on fixed deposits.
NOTE: Prabhu Bank is somehow providing 15% interest in Remit Fixed Deposits.
Highest Fixed Deposit Interest Rates in Nepal
| Bank | Remit Fixed Deposit (%) | Fixed Deposit Rate (%) |
|---|---|---|
| Sunrise Bank | 13.133 % | 12.133 % |
| Sanima Bank | 13.133 % | 12.133 % |
| Prime Commercial Bank | 13.133 % | 12.133 % |
| Mega Bank | 13.133 % | 12.133 % |
| Global IME Bank | 13.133 % | 12.133 % |
| Nabil Bank | 13.133 % | 12.133 % |
| NCC Bank | 13.133 % | 12.133 % |
| Civil Bank | 13.133 % | 12.133 % |
| RBB | 13.133 % | 12.133 % |
| Everest Bank | 13.133 % | 12.133 % |
Fixed Deposit Types
There are different types of fixed deposits that various banks provide these days. Some of the most popular ones are:
- Individual Fixed Deposit: This is the kind of fixed deposit that you are most likely to apply to. Individual fixed deposit is for regular bank account holders. This provides higher interest rates than institutional fixed deposit, but lower than remit fixed deposit.
- Institutional Fixed Deposit: This is for companies and corporations. These kind of fixed deposit provide the lowest interest rates in Nepal.
- Remit Fixed Deposit: These are the type of fixed deposits that provide the highest interest rates in Nepal. If you are within the country, then you cannot apply for Remit fixed deposit interest rate. You need to show the approved VISA, proof of employment in a foreign country to apply to remit fixed deposit.
Fixed Deposit Details
- Fixed Deposit Duration: Generally in Nepal, you and open a highest interest fixed deposit account for as low as 3 months. Most of the banks in Nepal will allow a minimum of 3 months fixed deposit and go higher from there. Some banks might reduce the fixed deposit interest rate by 1% for a fixed deposit of less than a year.
- Fixed Deposit Premature Withdrawal: For some reason, if you want to withdraw your fixed deposit from your bank account, then you might have to pay a pre-mature withdrawal fees. Some banks won’t even allow pre-mature withdrawal before 6 months, or 1 year duration. The pre-mature withdrawal free ranges from bank to bank and is generate 1% to 2% of the total sum of the fixed deposit.
- Fixed Deposit Interest Payment: If you want a steady cashflow, you might want to receive interest of the fixed deposit on a monthly basis. The interest is deposited in your bank account every month if you choose to get interest in your savings account monthly. For example, if you put 1000000 NRs(10 Lakh) is fixed deposit at 11.03% interest rate, that means you’ll receive 9191.6NRs in your bank account monthly. You can choose to get all the money at once at maturity, or monthly or quarterly or semi-annually or annually.
Fixed Deposit Interest Rate and Economy
High interest rates on Fixed Deposit are good for savings, but what effect does it have on the economy?
As the interest rates on Fixed Deposit increases, especially as high it is as now, the involvement in stock market decreases. People would rather safely gain 11% a year then risk losing their money. Hence, the rise in interest rate of fixed deposit is inversely proportional to Stock Market.
If the interest rates on Fixed Deposit increases, then the interest rates on loan also increases, meaning less and less people are able to or are open to take loans due to high interest rates. This mean less money flows in the economy, and banks hold more money.
So generally speaking, high interest rates in saving and fixed deposit in banks mean there is less liquidity in the overall economy and also in the stock market.
Fixed Deposit Projections
As of writing this post, there’s historically high fixed deposit in Nepal. The stock market is declining and it’s very tricky to make decent gains in the stock market at the current situation. So using fixed deposit to grow your capital would make sense for a lot of people. Let’s run over some numbers, and let’s see how much you can make in you put your money in Fixed Deposit at the current interest rate of 11.03%.
Let’s say you put 100000 NRs(10 Lakh) in fixed deposit. That means you’ll receive 110300 interest at the end of the year. Meaning you’ll be making 9191.6 NRs monthly from your fixed deposit.
For a 5 year duration, if you put the money received from the interest again in fixed deposit, at the end of 5 years, you will have 1687336.49 NRs if compounded yearly.
If you compound monthly, you’ll have an even better return of 1731487.34 NRs. You might get better returns from the stock market, but if you don’t have time to research good stocks, fixed deposit seem like a perfectly good alternative looking at the current scenarios.
You can your systematic investment plan(SIP) to divide you money in fixed deposits and stock market. Learn more about it here: SIP in Nepal. Or if you what to utilize the low market to buy undervalues shares, you can fix them here: Undervalued Shares in Nepal
Highest Fixed Deposit Interest Rates in Nepal – Conclusion
As seen above, many A class banks in Nepal are offering a very high interest rate of upto 13.133% on remit fixed deposit and 12.133% on individual fixed deposit. For people who are not active in stock market, this seems like a very good opportunity to grow their money using fixed deposit while still being on the safe side.
If you have any queries or questions, feel free to write them down in the comment section below!
