Banks offer a range of savings products that pay customers periodic or upfront returns on their savings. Upfront-interest time deposits are one option that lets customers receive the return at the start of the deposit term.

In this report, we review the key details of the 3-month upfront-interest time deposit from Bank NXT and EGbank, including the minimum amount, interest rate and features, along with the expected return on EGP 500,000.

Features of Bank NXT's 3-month upfront-interest time deposit

  • Tenor: 3 months.

  • Interest rate: 14.50% a year.

  • Payout frequency: paid upfront.

  • Minimum deposit: EGP 500,000 and multiples of EGP 1,000.

  • Eligible customers: individuals and companies.

Features of EGbank's 3-month upfront-interest time deposit

  • Tenor: 3 months.

  • Interest rate: from 4.75% up to 5.23% a year, according to the following tiers:

    • Below EGP 1 million: 4.75%.

    • EGP 1 million and above: 5.23%

  • Payout frequency: paid upfront.

  • Minimum deposit: EGP 10,000.

  • Eligible customers: Egyptian and foreign individuals.

  • Borrowing against the deposit: financing of up to 75% of the deposit value.

  • Credit cards: a credit card with a limit of up to 75% of the deposit value.

Banky's view

The comparison shows that Bank NXT's 3-month upfront-interest time deposit offers an annual interest rate of 14.50%, compared with up to 5.23% on EGbank's deposit of the same tenor.

On a deposit of EGP 500,000 for 3 months, the approximate return at Bank NXT is about EGP 18,125, based on the 14.50% annual rate applied for 3 months.

By comparison, the approximate return at EGbank is about EGP 5,938, based on the 4.75% annual rate applied for 3 months according to the rate tiers.

The difference in return on EGP 500,000 over 3 months therefore comes to about EGP 12,187 in favor of Bank NXT.