This time we are going to speak about deposits.
In fight for depositors’ money some representatives of our bank system decided not to disdain to use any means and play on one of the strongest human vices – greed.
In what way? Well, very simply! To offer the customers deposit interest which they will not be able to resist. But are such bank deposit products so attractive in reality? Let’s figure it out. Here are some examples:
1) ‘More every month’ deposit from Universal Bank.
The conditions of deposit:
- Term is 3 months;
- Interest rate in hryvnyas is: 1 month – 11%, 2 months – 15%, 3 months – 20% annually;
- Minimal deposit amount is 2 500 hryvnyas;
- Fulfillment or partial withdrawal are not allowed;
- Interest rate recalculation at pre-term denunciation is 0.00001% annually (!!!).
It is not difficult to calculate that at this price offer real deposit interest rate for 3 months will be 15.33% annually ((11% + 15% + 20%)/3). In such way deposit rate doesn’t look that attractive against a background of competitors, but it is not the reason to deny yourself putting a nice figure on an advertising board of the bank.
2) ‘Super growing’ deposit from PUMB.
The conditions of deposit:
- Term is up to 12 months;
- Interest rate for 1-3 months is 12%, 4-6 months – 14%, 7-9 months – 16%, 10-12 months – 20% annually;
- Minimal deposit amount is 1 000 hryvnyas;
- Fulfillment is not allowed;
- Interest rate recalculation at pre-term denunciation is equal to interest rate.
As a result we can see that real rate for yearly deposit is only 15.5% annually, but not 20% which was so nicely put on the bank site without any additional explanations. And therefore there will inevitably be disappointments during visiting the bank and getting familiar with real picture of deposit profitability.
3) ‘Growing’ deposit from Diamondbank.
The conditions of deposit:
- Term is up to 12 months;
- Interest rate for 1-3 months is 17%, 4-6 months – 18%, 7-9 months – 19%, 10-12 months – 20% annually;
- Minimal deposit amount is 2 000 hryvnyas;
- Fulfillment or partial withdrawal are not allowed;
- Interest rate recalculation at pre-term denunciation up to 100 days is 1%, after that – 17%.
In this case real deposit interest rate will be 18.5% annually which generally makes a deposit rather competitive, but only on condition that assets on your deposit will stay there for required 12 months.
In general, the tendency is obvious. Instead of making bank service market more transparent, the bankers prefer to use to the last insufficient financial literacy of the people, and play on greed of certain individuals…
