There is hardly any difference between a certificate of deposit CD and a fixed deposit which is the service available in banks in Nigeria. A fixed deposit is the closest anyone who wants CD in Nigeria can get.
Here is a major feature of fixed deposit in Nigeria and the major difference between a CD.
A fixed deposit or time deposit as some banks in Nigeria call it, is an investment account that defines a deposit amount with tenure and interest rates placed on it.
When the initial term agreed upon expires, the bank can roll over the investment or return to the investor with the interest amount earned. The decision to roll over will depend on the investors’.
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Features of Fixed deposit in Nigeria
- Fixed deposits in Nigeria are not transactional like CDs are in some countries.
- The minimum amount of deposit is $500 or about N200 000 to N230 000 in most banks in Nigeria.
- The interest rate is fixed – between 0.05% and 0.40% – at the date of deposit.
- Fixed deposit is available in – 91 days, 182 days, 1 year, 2 years, 3½ years, 5 years terms in many banks.
Not all financial institutions – insurance companies, trust companies, brokerage firms and investment dealers issue it in Nigeria, but most banks do.
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What to expect
- It is not flexible and you can only opt out after the first 91 days.
- No need to top up since it has a low minimum maintenance cost.
A fixed deposit is a safe way to invest and getting an account is easy. We are also available for account opening in any bank in Nigeria.