Lending and deposit rates in Nigeria have had a somewhat odd relationship. Throw in the Monetary Policy Rates (MPR) and you get an even strange relationship.
The monetary policy rate in Nigeria is the benchmark interest rate in the country because it is the rate at which the CBN lends money to commercial banks. Based on this, lending rates are expected to be higher than the MPR. Savings deposit rate on the other hand should at least be closer to the MPR as one would expect. Rather we see savings deposit rates remaining stagnant while other indices move in the direction of the MPR. We also have the fixed deposit rate which is the rate given to those who are willing to fix their money with banks for a period of time, usually not exceeding one year.
The disparity between the lending and savings rate have widened over the year, now currently as high as 25% per annum.
This data is provided by the Central Bank of Nigeria and is updated monthly by Nairametrics.
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