Access Bank, Others Send Messages to Customers on New Interest Rate on Savings Following CBN’s Hike
- Nigerian banks have announced a new interest rate on savings accounts
- In an email to its customers, Access Bank said it is increasing the interest rate on all its savings accounts to 5.40% per annum
- Other banks, such as Zenith Bank, FCMB, First Bank, and Fidelity Bank, also announced the new interest rate
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Following the Central Bank of Nigeria’s (CBN) hike of the Monetary Policy Rate (MPR), Nigerian banks have announced new interest rates on savings accounts.
One of Nigeria’s leading financial institutions, Access Bank, announced in an email to customers that it will reflect the new CBN interest rate on savings accounts "effective immediately."
Other banks announce new interest rate
Also, Zenith Bank, First Bank, FCMB, and Fidelity Bank, among others, announced a new interest rate on savings accounts.
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According to the email from Access Bank, it increased the interest rate on all savings accounts to 5.40% per annum.
Also, Zenith Bank and other banks increased to similar rates to reflect the new MPR by CBN.
During its last MPR meeting, the CBN announced a new hike in the interest rate to 18% to combat rising inflation and improve the standard of living in the country.
The effect of increased interest rate on savings
The effect of the quarterly hike in interest by the CBN can be felt in purchasing power, the standard of living, and the hike in prices of consumer goods.
The hikes also erode savings in banks and other financial instruments.
Commercial banks use the rate as their benchmark for their lending.
High-interest rate increases borrowing costs and encourages people to spend less and save more.
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When CBN hikes interest rates, it curbs demand-side inflationary pressures by reducing the volume of the money supply.
CBN issues directives to banks to increase interest on savings after 15.5% rate hike
Legit.ng earlier reported that following the recent interest rate hike in Nigeria to 15.5% by the Central Bank of Nigeria (CBN), the apex bank had issued a directive to banks to pay 4.65% interest on savings accounts, which is an increase from the previous 4.2%.
The recent directive is due to the 150 basis point addition in monetary policy rates to 15.5% from 14%.
The CBN's decision came from increased interest rates on savings deposits, which could mop up excess liquidity in the system.