The fixed deposit interest rate in Nepal has always been discussed as one of the most profitable investments in Nepal. The fixed deposit has often been a popular investment option for a long, not only among investors but also among common people.
The fixed deposit (FD) interest rate has a profound impact on the economy of any country. The economic scenario of any developing country is greatly dependent on how the top private banks fix their interest rates every year.
The FD interest rate of Nepal is announced by almost every bank and it plays a great role in deciding how much people save every year. For a better future and bright life, people take a different option. They invest their money in short-term and long-term deposits.
Fixed deposits are considered the safest investment. Interest rates on fixed deposits in Nepal are market-led and are likely to continue to increase, and here we are going to look after those interest rates.
The interest rates for FD can be changed promptly so consult your bank or financial partner.
What is a Fixed Deposit?
A Fixed Deposit (FD) is a type of financial instrument, provided by banks and other financial institutions, which offers investors a higher rate of interest than a regular savings account, until the agreed maturity date.
The investor is not able to access the funds during the fixed term but can do so after, subject to conditions. There are many reasons why people choose to invest in a Fixed Deposit.
The most common reason is the guaranteed return on investment. When you invest in a Fixed Deposit, you know exactly how much money you will get back, and when you will get it. This predictability is appealing to many investors, especially those who are risk-averse.
Check Out: Fixed Deposit Calculator
Fixed Deposit Interest Rate in Nepal Comparison Chart
Generally, Banking Institutions have different types of Fixed Deposits. On a country basis: One is for the people who live within the country and the other is for those outside Nepal.
Remittance Rate: The rate for people who are outside of Nepal and want to fix deposit their money for a certain period.
Domestic Rate: The rate for the people who live within Nepal and want to fix deposit their money for a certain period.
Note: Please check Individual bank website to see the final interest rates in Fixed Deposit. The interest rates is subject to change from Bank Side on monthly or yearly basis.
| ‘A’ Class Commercial Banks in Nepal | Domestic Rate (%) | Remittance Rate (%) |
|---|---|---|
| Nepal Bank Ltd. | 11.133% | 11.133% |
| Agriculture Development Bank Ltd. | 11.133% | 13.13% |
| Nabil Bank Ltd. | 11.133% | 12.133% |
| Nepal Investment Mega Bank Ltd. | 11.133% | 12.133% |
| Standard Chartered Bank Nepal Ltd. | 10.13% – 11.133% | – |
| Himalayan Bank Ltd. | 09.03% – 11.133% | 11.133% |
| Nepal SBI Bank Ltd. | 11.133% | 12.133% |
| Everest Bank Ltd. | 11.133% | 12.133% |
| Kumari Bank Ltd. | 11.133% | 12.133% |
| Laxmi Bank Ltd. | 11.133% | 12.133% |
| Citizens Bank International Ltd. | 11.133% | 12.133% |
| Prime Commercial Bank Ltd. | 11.133% | 13.13% |
| Sanima Bank Ltd. | 11.133% | 12.51% |
| NIC Asia Bank Ltd. | 11.133% | 12.133% |
| Global IME Bank Ltd. | 11.133% | 12.133% |
| NMB Bank Ltd. | 11.133% | 11.133% |
| Prabhu Bank Ltd. | 11.133% | 11.133% |
| Siddhartha Bank Ltd. | 11.133% | 12.133% |
| Rastriya Banijya Bank Ltd. | 11.133% | 12.133% |
Check Out: Debenture vs Fixed Deposit – Which One to Choose?
Advantages of Fixed Deposit in Nepal
There are many advantages of having a fixed deposit in the bank. Here are some of the advantages:
- FD is a safe and secure investment option.
- Fixed Deposits offer higher interest rates than savings accounts.
- They are a good way to save money for specific goals.
- FD can be used as collateral for loans.
- They are easy to set up and manage.
The advantage of a Fixed Deposit is that it offers a higher rate of interest than a regular savings account. This is because the bank knows that the money will be locked away for a set period.
So they can afford to offer a higher interest rate. This can be a significant advantage if you are looking to grow your money over a short or medium-term period.
Finally, a Fixed Deposit can be a useful tool for saving for a specific goal. By setting aside money each month into a Fixed Deposit, you can quickly build up a sum of money that can be used for a down payment on a house, a child’s education, or a once-in-a-lifetime holiday.
If you are looking for a safe and predictable investment, with the potential to earn a higher return than a regular savings account, then a Fixed Deposit may be the right choice for you.
In recent times, you can also use your mobile banking app to apply for Fixed deposits without visiting banks.
Disadvantages of Fixed Deposit
There are a few disadvantages of fixed deposits in the bank that customers should be aware of before investing their money.
- Low-Interest Rates: One of the biggest disadvantages of fixed deposits is the low-interest rate that is offered. This is because the bank knows that your money is locked away for a set period, so they don’t need to offer a high-interest rate to entice you to keep your money with them.
- Inflexible: Another downside of fixed deposits is that they are inflexible. Once you have deposited your money, you are usually not able to access it until the end of the term. This can be problematic if you suddenly need access to your cash.
- Penalty for Withdrawing Early: If you do need to access your money before the end of the term, there is usually a penalty for doing so. This can include a loss of interest or even a fee. This means that you could end up losing money if you need to withdraw from your fixed deposit early.
- Not Suitable for Everyone: Fixed deposits are not suitable for everyone. If you need access to your money regularly or you are worried about the possibility of needing to withdraw early, then a fixed deposit might not be the right investment for you.
- Requires Planning: Investing in a fixed deposit requires planning. You need to make sure that you will not need access to your cash during the term of the deposit, as this could result in losses.
Fixed deposits can be a good investment for some people, but they are not right for everyone. If you are thinking about investing in a fixed deposit, make sure you are aware of the disadvantages so that you can make an informed decision.
Also Read: Upcoming IPOs in Nepal
FAQs about FD in Nepal
How to choose the best fixed-deposit bank in Nepal?
To choose the best-fixed deposit bank in Nepal, you can see the interest rate of each bank, compare them with each bank’s rate, check the maturity date and compound years/months, and select one from the above table.
Which bank has the highest Fixed Deposit interest rates in Nepal?
According to the above interest table, almost all the banks have the highest interest rate for the fixed deposit in Nepal. Also, here you can see the interest rates of 14% for Remittance Muddati Khata and 12.133% for domestic Muddati Khata.
Is Fixed Deposit a good investment in Nepal?
A fixed deposit in Nepal is a good investment because it offers a higher interest rate than a savings account, and you know exactly how much interest you will earn. You can also access your money before the end of the term if you need to, although you may pay the penalty.
Takeaway
Before depositing, your investments to a fixed one take your time to consider all your options for investment. Do not invest in just hearing that something is good. All returns are not equal and all investments can’t be compared with others.
If you are in investing in the Share Market then you can also compare the benefits and risks of the investment in the share market with the interest rates of the bank in normal deposits or the fixed deposit. You can also use our NEPSE Buy/Sell Calculator to calculate the total amount for buying or selling
I hope now you can get deep insights into the Fixed Deposit Interest Rate in Nepal and the advantages of FD Deposit.
If you have any queries/feedback, feel free to comment below.
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