Banks offer a variety of savings products that let customers invest their savings and earn a regular return, and fixed-rate certificates are among the options available to those seeking a steady income over the investment period. Interest rates and minimum amounts for certificates vary from bank to bank, depending on each certificate's terms.

In the following comparison, we review the details of the fixed-rate 5-year certificate with monthly payout from National Bank of Kuwait – Egypt (NBK Egypt) and Crédit Agricole Egypt, setting out the interest rates, key features and expected return on EGP 500,000.

Features of NBK Egypt's fixed-rate 5-year certificate with monthly payout

  • Tenor: 5 years.

  • Interest rate: 15% per annum.

  • Payout frequency: monthly.

  • Rate type: fixed for the full term of the certificate.

  • Minimum purchase: EGP 5,000, in multiples of EGP 1,000.

  • Option to apply for a personal loan or credit cards of up to 90% of the certificate's value.

  • Access to a debit card, internet banking and a 24-hour customer service centre.

  • Access to more than 650,000 ATMs worldwide

Features of Crédit Agricole Egypt's fixed-rate 5-year certificate with monthly payout

  • Tenor: 5 years.

  • Interest rate: 9% per annum.

  • Payout frequency: monthly.

  • Rate type: fixed for the full term of the certificate.

  • Minimum amount: EGP 5,000.

  • Target customers: individuals.

  • Option to borrow or obtain a credit card secured against the certificate's value.

  • Option to use the certificate as collateral for a loan or credit card at preferential rates.

  • 24-hour account access and management via internet banking, phone banking and ATMs.

Banky's view

The comparison shows a gap in annual interest rates between NBK Egypt's fixed-rate 5-year certificate with monthly payout, which offers 15%, and Crédit Agricole Egypt's 5-year certificate, which offers 9%, a difference of 6 percentage points.

On a deposit of EGP 500,000, the annual return comes to about EGP 75,000 at NBK Egypt, compared with EGP 45,000 at Crédit Agricole Egypt, a difference of EGP 30,000 a year.

On a monthly basis, the customer receives about EGP 6,250 a month from the NBK Egypt certificate, compared with EGP 3,750 a month from the Crédit Agricole Egypt certificate, a difference of EGP 2,500 a month.

Over 5 years, the total return on EGP 500,000, using a simple calculation that does not account for reinvesting the returns, comes to about EGP 375,000 at NBK Egypt, compared with EGP 225,000 at Crédit Agricole Egypt, a total difference of EGP 150,000.