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2024-01-06 6:59 AM

Best fixed deposit rates in South Africa January 2024

By Parddon Khumalo
RankingName of BankInterest Rate (Nominal)
1Access Bank10.45%
2TymeBank10.44%
3Sasfin Bank10.25%
4SA Retail Bonds10.00%
5African Bank9.94%

The best fixed deposit rate in South Africa for January 2024 is the Access Bank fixed deposit with a nominal interest rate of 10.45% and an effective interest rate of 10.97%. The account requires a minimum deposit of R1.00 of which should be invested for a period of 60 months.

In 2024, South Africa’s investment landscape offers a variety of fixed deposit account options, each with unique rates and terms. Fixed deposit accounts are popular among investors seeking stable and secure ways to grow their savings.

This comprehensive guide provides a detailed overview of the best fixed deposit interest rates in South Africa for 2024, along with essential information on taxation, safety, and factors to consider when choosing the right fixed deposit account.

Fixed deposit accounts have long been a popular choice for South African investors looking for a secure and stable way to grow their savings. In this comprehensive guide, we’ll provide you with the most up-to-date information on the best fixed deposit interest rates in South Africa for 2024.

Understanding Fixed Deposit Accounts

What is a Fixed Deposit Account?

A fixed deposit account, also known as a term deposit, offers a fixed interest rate over a specified period, providing a secure way to grow savings. It’s a popular choice for South African investors looking for stable returns.

How Fixed Deposit Accounts Work

Explains the mechanics of fixed deposit accounts, including depositing, interest rates, maturity periods, and the concept of capital protection.

What to consider when choosing a FD account

When selecting a fixed deposit account, consider the following factors:

Interest Rate

Interest rates vary depending on the bank and the duration of the fixed deposit. Longer-term deposits often offer higher interest rates. Always compare rates to maximize your returns.

Minimum Opening Balance

Different banks have varying minimum deposit requirements. Ensure that the minimum opening balance aligns with your financial capacity.

Maturity Date

Determine how long you want to invest your money. Fixed deposit terms range from a few months to several years. Match your investment horizon with the appropriate term.

Early Withdrawal Penalties

Be aware of any penalties associated with early withdrawals. Some banks charge fees for accessing funds before the maturity date.

Interest Payout Options

Understand how the interest is paid out. It can be on a monthly, quarterly, biannual, or annual basis, depending on your preference.

When opening a fixed deposit account, consider how long you want to invest your money and the interest rate range you want. The duration and amount of investment in a fixed deposit account have the greatest influence on interest rates on fixed deposit accounts. Remember to checkout our Fixed Deposit Interest Calculator.

This article is your guide to discovering the most attractive fixed deposit rates in South Africa. We’ll delve into various fixed deposit durations, ranging from 3 months to 60 months. It’s important to note that prominent banks typically offer the most competitive interest rates for fixed deposit accounts spanning 36 to 60 months. Conversely, interest rates for shorter to medium-term investments tend to be dominated by medium and smaller financial institutions.

In the following sections, we will provide comprehensive insights into each fixed deposit account category, showcasing the top three current rates for each.

Best 60 months fixed deposit rates January 2024

RankingBankMinimum AgeMinimum DepositNominal Interest RateEffective Interest Rate
1Access Bank PLC18R1.0010.46%10.97%
2Sasfin Bank18R20,000.0010.25%10.75%
3SA Retail Bonds18R1,000.0010.00%10.25%

1. Access Bank PLC

Access Bank PLC secures the second spot with a competitive 10.45% nominal interest rate, translating to a robust 10.97% effective interest rate. What’s remarkable is the accessibility, as it requires a minimal initial deposit of just R1.00, making it an attractive choice for a wide range of investors aged 18 and above.

2. Sasfin

For investors looking to commit a larger sum, Sasfin offers an appealing option. With a 10.25% nominal interest rate and an effective interest rate of 10.75%, it promises steady growth. However, it requires a minimum deposit of R20,000.00 and is available to individuals aged 18 and above.

3. SA Retail Bonds

With an impressive 10.00% nominal interest rate and an effective interest rate of 10.25%, SA Retail Bonds lead the pack. Investors aged 18 and above can kickstart their financial journey with a minimum deposit of R1,000.00. This exceptional offering sets the stage for secure and rewarding investments.

Best 48 Months Fixed Deposit Rates January 2024

RankingBankMinimum DepositNominal Interest Rate %Effective Interest Rate %
1Access BankR1.0010.10%10.58%
2Capitec BankR1,000,000.009.30%9.71%
3FNBR1,000,000.009%9.38%

1. Access Bank

Taking the lead with a robust 10.10% nominal interest rate, Access Bank offers an impressive 10.58% effective interest rate. What makes this option even more enticing is the accessibility, requiring a minimal deposit of just R1.00. This means investors can potentially enjoy substantial returns with a modest financial commitment, making it an excellent choice for those seeking high-yield investments without significant initial investment requirements.

2. Capitec Bank

Securing the second position, Capitec Bank offers a competitive 9.30% nominal interest rate, translating to a solid 9.71% effective interest rate. Although the minimum deposit requirement is R1,000,000.00, this option caters to investors looking for stable and lucrative growth opportunities over the 48-month term. Capitec Bank’s offering balances attractive returns with a moderate investment threshold.

3. FNB

In the third spot, FNB provides a 9% nominal interest rate, resulting in a respectable 9.38% effective interest rate. Like Capitec Bank, FNB requires a minimum deposit of R1,000,000.00. This choice is ideal for investors who prioritize stability and consistent returns, making it a prudent option for long-term financial planning.

Best 36 Months Fixed Deposit Rates January 2024

RankingBankMin DepositNominal Interest Rate (%)Effective Interest Rate (%)
1SasfinR20,000.0010.00%10.47%
2Access BankR1.009.80%10.20%
3African BankR500.009.44%9.85%

1. Sasfin

Taking the top position, Sasfin offers an impressive 10.00% nominal interest rate, translating into an attractive 10.47% effective interest rate. With a minimum deposit requirement of R20,000.00, Sasfin provides an opportunity for substantial returns, making it an excellent choice for investors seeking a significant long-term growth avenue.

2. Access Bank

Securing the second spot, Access Bank offers a competitive 9.80% nominal interest rate, resulting in a solid 10.25% effective interest rate. While the minimum deposit required is merely R1.00, this option ensures attractive returns for even the most conservative investors, making it an excellent choice for those prioritizing stability and consistent growth.

3. African Bank

African Bank boasts a 9.44% nominal interest rate, leading to an appealing 9.85% effective interest rate. With a more accessible minimum deposit requirement of R500.00, African Bank caters to a broader range of investors, providing a secure and steady path for their investments to flourish over the 36-month term.

Best 24 months fixed deposit rates January 2024

RankingBankMin DepositNominal Interest Rate (%)Effective Rate (%)
1Sasfin BankR20,000.009.80%10.78%
2Access Bank PlcR1.009.55%9.98%
3African BankR500.009.34%9.75%

1. Sasfin Bank

Clinching the top spot, Sasfin Bank offers an enticing 9.80% nominal interest rate, translating into an impressive 10.78% effective interest rate. Requiring a minimum deposit of R20,000.00, Sasfin Bank provides a secure haven for investors looking for substantial returns over the 24-month term.

2. Access Bank Plc

Seizing the second position, Access Bank Plc offers a competitive 9.55% nominal interest rate, ensuring a solid 9.98% effective interest rate. Remarkably, the minimum deposit required is merely R1.00, making this choice accessible to a wide range of investors.

3. African Bank

Claiming the third spot, African Bank present a dependable option with a 9.34% nominal interest rate, resulting in a reliable 9.75% effective interest rate. Requiring a minimum deposit of R500.00, this choice balances accessibility with consistent growth, making it an attractive option for investors seeking stability and reliable returns over the 24-month duration.

Best 12 months fixed deposit rates January 2024

RankingBankMinimum DepositNominal Interest Rate %Effective Interest Rate %
1TymeBankR1.0010.44%11%
2Access BankR0.019.50%9.92%
2Sasfin BankR20,000.009.50%9.92%
Best 12 months fixed deposit rates

1. TymeBank

Seizing the first position, TymeBank offers an impressive 10.44% nominal interest rate, translating into an exceptional 11% effective interest rate. With a remarkably low minimum deposit requirement of just R1.00, TymeBank opens the door to high-yield investments for all. Positioned as the frontrunner, TymeBank promises substantial growth potential for short-term investors, ensuring a robust foundation for your financial aspirations.

2.Access Bank

Claiming the second spot, Access Bank presents a competitive option with a 9.50% nominal interest rate, resulting in a solid 9.92% effective interest rate. Requiring a minimum deposit of R0.01, African Bank strikes a balance between accessibility and considerable growth. This choice caters to investors seeking stability and reliable returns over the 12-month duration, making it an appealing prospect for a diverse range of financial goals.

2. Sasfin Bank

Tied at the 2nd position, Sasfin Bank offers a reliable option with a 9.50% nominal interest rate, ensuring a consistent 9.92% effective interest rate. With a minimum deposit requirement of R20,000.00, Sasfin Bank provides a stable platform for investors with a slightly larger capital base. Positioned as a trusted choice, Sasfin Bank combines security and growth, making it a dependable partner for your year-long investment plans.

Best 6 months fixed deposit rates January 2024

RankingBankMin DepositNominal Interest Rate (%)Effective Interest Rate (%)
1Access BankR5,000,000.009.00%9.38%
2Bidvest BankR500.008.90%9.06%
3Sasfin BankR20,000.008.66%8.82%

1. Access Bank

Leading the pack, Access Bank offers a nominal interest rate of 9.00%, translating into an effective interest rate of 9.38%. With a minimum deposit requirement of R5,000,000.00, Access Bank caters to investors with significant capital, promising substantial returns over the 6-month period.

2. Bidvest Bank

Securing the second spot, Bidvest Bank offers a reliable option with a nominal interest rate of 8.90%, translating into an effective interest rate of 9.06%. With a minimum deposit requirement of R10,000.00, Bidvest Bank provides a solid foundation for investors looking for stable returns and security in their 6-month investment.

3. Sasfin Bank

Claiming the third position, Sasfin Bank presents a compelling option with a nominal interest rate of 8.66%, ensuring an effective interest rate of 8.82%. Requiring a minimum deposit of just R20,000.00, Sasfin Bank strikes a balance between accessibility and noteworthy growth.

Best 3 months fixed deposit rates January 2024

RankingBankMin DepositNominal Interest Rate %Effective Interest Rate %
1TymeBankR1.008.90%9.30%
2Access BankR5,000,000.008.60%8.95%
3BidvestR10,000.008.54%8.60%

1. TymeBank

Leading the chart, TymeBank offers a nominal interest rate of 8.90%, translating into an effective interest rate of 9.30%. Requiring a minimum deposit of R1.00, TymeBank caters to investors seeking substantial returns within a 3-month timeframe.

2. Access Bank

Securing the second position, Access Bank provides an attractive offer with a nominal interest rate of 8.60%, resulting in an effective interest rate of 8.95%. With a minimum deposit requirement of just R5,000,000.00, Access Bank opens the doors of short-term investment to a wide range of investors.

3. Bidvest Bank

Claiming the third spot, Bidvest Bank offers a stable platform with a nominal interest rate of 8.54%, ensuring an effective interest rate of 8.60%. Requiring a minimum deposit of R10,000.00, Bidvest Bank appeals to investors looking for a balanced blend of security and modest growth within a 3-month horizon.

Safety and Taxation of South African Fixed Deposit Accounts

When it comes to financial investments, safety and taxation are two crucial aspects that should be on every South African investor’s radar. Fixed deposit accounts, known for their stability and predictable returns, offer a secure avenue for growing your savings. In this section, we’ll explore the safety of fixed deposit accounts and shed light on how they are taxed in South Africa.

Safety of Fixed Deposit Accounts

One of the primary reasons fixed deposit accounts are favoured by investors in South Africa is their safety. Here’s why they are considered a secure option:

1. Capital Protection: Fixed deposit accounts provide capital protection, meaning your initial deposit is safe and will be returned to you in full at the end of the agreed-upon investment term. This assurance makes them an attractive choice for risk-averse investors.

2. Guaranteed Returns: With fixed deposit accounts, you know precisely how much interest you will earn. The interest rate is fixed for the duration of the investment, offering predictability and peace of mind.

3. Regulatory Oversight: Banks and financial institutions in South Africa that offer fixed deposit accounts are subject to strict regulatory oversight by institutions such as the Reserve Bank. These regulations are in place to safeguard the interests of depositors and maintain the stability of the banking sector.

4. Financial Institution Reputation: Established and reputable banks are often the primary providers of fixed deposit accounts. Investing with well-known institutions adds an extra layer of security to your savings.

Taxation of Fixed Deposit Accounts in South Africa

Understanding the tax implications of your investments is essential for sound financial planning. Here’s what you need to know about the taxation of fixed deposit accounts in South Africa:

1. Taxable Interest Income: The interest you earn from fixed deposit accounts is considered taxable income in South Africa. This means you are required to pay tax on the interest you receive.

2. Interest Withholding Tax (IWT): South African banks are responsible for deducting interest withholding tax (IWT) from the interest paid to account holders. The current IWT rate is 15%, but the rate may differ depending on your tax status. The deducted tax is typically remitted to the South African Revenue Service (SARS) on your behalf.

3. Declaration of Interest Income: It’s crucial to declare the interest income earned from your fixed deposit accounts when filing your annual income tax return. Failure to do so may result in penalties and legal consequences.

4. Tax-Free Savings Accounts (TFSAs): South Africa offers tax-free savings accounts (TFSAs) as an alternative to regular fixed deposit accounts. Interest earned in a TFSA is tax-free, up to a specified annual limit. This option can be attractive for those looking to minimize their tax liability.

5. Early Withdrawal Implications: If you decide to withdraw funds from your fixed deposit account before the maturity date, you may still be liable for tax on the interest earned up to that point. Early withdrawals can also result in penalties or reduced interest payments.

By being aware of the taxation rules and safety features associated with fixed deposit accounts, you can make informed decisions that align with your financial goals and risk tolerance.

FREQUENTLY ASKED QUESTION (FAQ)

What is a fixed deposit account?

A fixed deposit account, also known as a term deposit, offers a fixed interest rate over a specified period, providing a secure way to grow savings. It’s a popular choice for South African investors looking for stable returns.

Which bank offers the best fixed deposit rate in South Africa for 2024?

The Access Bank fixed deposit account boasts the highest fixed deposit rate for 2024 with a 10.45% nominal interest rate and 10.97% effective interest rate.

What are the typical tenure options for fixed deposit accounts in South Africa?

Fixed deposit tenures in South Africa can range from a few months to several years. Common options include 3, 6, 12, 24, 36, 48, and 60-month terms.

How do fixed deposit accounts work?

Fixed deposit accounts involve depositing a sum of money with a bank or financial institution for a predetermined period. The bank pays you interest on the deposited amount at a fixed rate. Upon maturity, you can withdraw the initial deposit and the accrued interest.

What factors should I consider when choosing a fixed deposit account?

Consider factors like interest rate, minimum opening balance, maturity date, early withdrawal penalties, and interest payout options. Matching your investment horizon with the appropriate term is crucial for maximizing returns.

How are interest rates determined for fixed deposit accounts?

Interest rates vary based on prevailing market rates, competition, and the amount and tenure of your deposit. Longer-term deposits often offer higher interest rates, ensuring stable returns for investors.

Are fixed deposit accounts safe in South Africa?

Yes, fixed deposit accounts in South Africa are considered safe. They provide capital protection, guaranteed returns, and are subject to regulatory oversight by institutions like the Reserve Bank. Reputable banks offer an extra layer of security.

How is the interest earned from fixed deposits taxed in South Africa?

The interest earned from fixed deposits is considered taxable income in South Africa. Banks deduct interest withholding tax (IWT) from the interest paid to account holders, typically at a rate of 15%. It’s crucial to declare this income when filing your annual tax return.

What happens if I withdraw my funds before the fixed deposit maturity date?

Early withdrawals may result in penalties or reduced interest payments. Additionally, you may still be liable for tax on the interest earned up to the withdrawal date. It’s important to be aware of the implications before making an early withdrawal decision.

Are there tax-free options for fixed deposits in South Africa?

Yes, South Africa offers tax-free savings accounts (TFSAs) as an alternative to regular fixed deposit accounts. Interest earned in a TFSA is tax-free, up to a specified annual limit. This option can be attractive for minimizing tax liability on savings.

What is the best investment duration for fixed deposits?

The best investment duration depends on your financial goals and risk tolerance. Generally, prominent banks offer competitive rates for fixed deposit accounts spanning 36 to 60 months, while shorter to medium-term investments often have competitive rates from medium and smaller financial institutions.

Is there a minimum and maximum tenure for fixed deposit accounts in South Africa?

Yes, the tenure for fixed deposit accounts typically ranges from a few months to several years. The minimum and maximum terms vary by bank but often start from three months and can extend up to five years.

How often is interest paid out in fixed deposit accounts?

Interest payout frequency varies and can be monthly, quarterly, biannually, or annually. The payout frequency depends on the terms of the fixed deposit account and your preference as an investor.

Can I open a fixed deposit account with a low initial deposit?

The minimum opening balance varies between banks. While some banks require substantial initial deposits, others offer accessible options, allowing investors to open accounts with relatively low amounts, making fixed deposits accessible to a wider range of individuals.

Are fixed deposit rates fixed throughout the investment period?

Yes, fixed deposit rates are fixed for the entire chosen tenure. The rate remains constant, providing investors with predictable returns throughout the investment period.

What is the difference between nominal and effective interest rates?

Nominal interest rate is the stated interest rate on the fixed deposit account, while the effective interest rate reflects the actual return after factoring in compounding. Effective interest rate provides a more accurate picture of the investment’s growth potential.

What are the implications of missing a fixed deposit renewal deadline?

Missing the renewal deadline might lead to the conversion of your fixed deposit account into a regular savings account with a lower interest rate. It’s essential to keep track of your account’s maturity date to avoid unintended consequences.

Can I negotiate the interest rate for a fixed deposit account?

Typically, fixed deposit rates are set by the bank and may not be negotiable. However, you can explore various banks and financial institutions to find the most competitive rates that align with your investment goals.

Are there alternatives to fixed deposit accounts in South Africa?

Yes, besides fixed deposit accounts, South Africa offers a variety of investment options such as savings accounts, money market accounts, unit trusts, and government bonds. Each option has its unique features, allowing investors to diversify their portfolios based on their preferences and risk tolerance.

What is the process for opening a fixed deposit account in South Africa?

To open a fixed deposit account, you need to visit the bank or financial institution of your choice. You’ll be required to provide identification documents, proof of address, and the initial deposit amount. The bank will guide you through the necessary paperwork and terms and conditions.

Are there age restrictions for opening a fixed deposit account?

Typically, fixed deposit accounts are available to individuals aged 18 and above. Banks may have specific requirements, so it’s advisable to check with the respective bank regarding age restrictions when opening an account.

What documents do I need to provide to open a fixed deposit account?

To open a fixed deposit account, you usually need to provide identification documents such as a valid passport, national ID, or driver’s license. Additionally, you’ll need proof of address, like a utility bill or bank statement, and the initial deposit amount. Requirements may vary slightly between banks, so it’s best to confirm with the specific institution you choose.

Conclusion

South Africa’s fixed deposit market offers diverse opportunities for investors. For long-term commitments of 60 months, Access Bank lead with an impressive 10.45% interest rate. In the 48-month category, Access Bank stands out at 10.10%, requiring just R0.01 initial deposit. Sasfin dominate the 36-month term at 10.00%. Over 24 months, Sasfin Bank shines with a 9.80% rate. For 12 months, TymeBank leads at 10.44%, requiring only R1.00. Lastly, for 6 and 3 months, Access Bank offers competitive rates at 9.00% and 8.60% respectively. Choose wisely based on your investment goals and horizon

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Parddon Khumalo

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