BAKU, Azerbaijan, Feb. 15
Trend:
The volume of total savings deposits in the national currency in second-tier banks of Kazakhstan exceeded one trillion tenge ($2.3 billion) as of late 2021, Trend reports via the country’s Deposit Insurance Fund (KDIF).
According to the fund, since the launch of savings deposits (in late 2018), the volume of these deposits has increased by more than 37 times. No other type of deposit showed similar results over the reporting period.
The unprecedented growth shows that citizens have become more responsible in choosing deposits and prefer savings deposits for long-term purposes.
Savings deposits are a relatively new financial instrument on the market. Despite this, Kazakhstan citizens appreciated all its advantages.
Such deposit is opened for a certain period, during which partial withdrawal of money isn’t allowed. It’s possible to withdraw the entire deposit amount ahead of schedule, but in this case, the depositor must notify the bank of his intention 30 calendar days in advance, while the accrued interest is lost (the interest is paid at the demand deposit rate of 0.1 percent).
These conditions pay off with increased yield on a savings deposit in tenge. Today, no risk-free financial instrument can offer such a high yield. The rate on annual savings deposits without the right to replenish reaches 14.9 percent, with an annual inflation rate of 8.5 percent.
It’s also possible to choose a savings deposit with an additional replenishment function. In this case, the maximum rate reaches 13.7 percent. This condition allows the depositor to fix a high rate on the deposit and further replenish the deposit at this rate until the expiration of the agreement.
Another distinctive feature is the increased amount of the KFGD guarantee. Initially, the set maximum amount of guarantee compensation for savings deposits in tenge was significantly higher than for other types of deposits.
So, until January 11, 2022, the maximum amount of compensation was 15 million tenge ($35,000). However, given the constant growth in the volume of savings deposits, from January 11 of this year, the guarantee amount was increased to 20 million tenge ($46,000) in order to ensure the safety of the savings of Kazakh citizens and encourage them to keep their savings in long-term and stable deposits.
The maximum amount of KDIF’s total guarantee for depositors who have both a savings deposit in tenge and other types of deposits in one bank was also increased to 20 million tenge.