This is a short summary of savings options in Nigeria in the month of December 2019. Please note that these are savings options as opposed to investments although some of the options are ‘investment like’. Generally savings options are:- Shorter term in nature (this is with the exception of a pension which is a long term savings vehicle geared towards retirement).- Lower risk than investments.- Structured around an ‘account’ into which money is paid regularly and earns interest.- Formal and informal- Offered by banks as opposed to other types of financial services institutions.
It’s worth noting that in Nigeria savings accounts at Commercial and primary mortgage banks are covered by the Nigeria Deposit Insurance Corporation (NDIC) scheme which means that in the event of a bank failure, depositors funds are covered up to the limit which is currently ₦200,000 for primary mortgage banks and ₦500,000 for commercial banks. This additional ‘safety’ comes at a price as we can see from the list that commercial bank rates tend to be the lowest.
Thank you for listening!