Best fixed deposit rates in South Africa 2023 (Updated) (2024)

In 2023, the leading choice for a fixed deposit account in South Africa is the TymeBank fixed deposit account, boasting an impressive 11.00% interest rate for its 12-month term. This account sets a remarkably accessible minimum deposit requirement of just R0.01, which must be maintained throughout the entire investment duration.

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 2023.

What is a Fixed Deposit Account?

A fixed deposit account, also known as a term deposit account, is a financial product offered by banks and financial institutions in South Africa. It provides a fixed interest rate over a specified period, which can range from a few months to several years. The primary purpose of a fixed deposit account is to help individuals grow their savings by earning a higher rate of interest compared to a regular savings account.

When opening a fixed deposit account, it is essential to consider the interest rates offered by different banks and financial institutions. Some institutions may provide higher rates for longer-term deposits, while others may offer attractive rates for shorter-term deposits. By comparing the rates, individuals can maximize their returns on investment.

It’s also important to take into account any fees or charges associated with the account, as they can impact the overall return on investment. These fees may include account opening or maintenance fees, early withdrawal penalties, or charges for accessing interest payments before the account reaches maturity.

At the end of the agreed-upon term, the principal investment amount is returned to the account holder. Interest, on the other hand, can be withdrawn at regular intervals, such as monthly, quarterly, biannually, or annually, depending on the individual’s preference. If the interest is not withdrawn, it is often capitalized either monthly or yearly, according to the policies of the financial institution.

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 2023

1. Access Bank Plc

Access Bank Plc claims the top spot for the best 60-month fixed deposit rate in South Africa, offering an attractive nominal interest rate of 10.45%. To take advantage of this rate, investors need to meet the minimum deposit requirement of R500. What sets this rate apart is its impressive effective interest rate of 10.97%, making it a compelling choice for those seeking long-term financial growth.

2. SA Retail Bonds

SA Retail Bonds secures the second position on our list, offering a competitive nominal interest rate of 10.50% for a 60-month fixed deposit account. The minimum deposit required is R1,000. The effective interest rate, which stands at 10.78%, showcases the potential for substantial returns over the investment period. SA Retail Bonds is an appealing option for individuals looking to secure their savings over the long haul.

3.Sasfin

Sasfin earns the third spot with its 60-month fixed deposit rate, offering a nominal interest rate of 10.25%. To open an account with Sasfin and access this rate, a minimum deposit of R20,000 is required. The effective interest rate of 10.75% makes this option a strong contender for investors seeking steady growth over a five-year period.

These top three fixed deposit rates in the 60-month category provide an overview of the competitive landscape in South Africa, catering to a range of investors with varying deposit sizes and preferences for long-term financial planning. It’s essential to carefully consider your financial goals and deposit capacity when choosing the most suitable option for your investment needs.

Best 48 Months Fixed Deposit Rates 2023

1. Access Bank

Access Bank secures the top position for the best 48-month fixed deposit rate in South Africa, offering an attractive nominal interest rate of 10.10%. What’s particularly noteworthy is that Access Bank allows a minimum deposit of just R0.01, making it accessible to a wide range of investors. This competitive rate provides an excellent opportunity for individuals looking to grow their savings over a four-year period.

2. Capitec Bank and FNB (Tied)

Capitec Bank and FNB share the second spot on our list, both offering a nominal interest rate of 9.60% for a 48-month fixed deposit account. However, it’s important to note that they require a substantial minimum deposit of R1,000,000.00, which may limit accessibility to high-net-worth individuals or those with significant savings. These rates are competitive and can provide solid returns for those who can meet the minimum deposit requirement.

These top three fixed deposit rates in the 48-month category showcase the diversity of options available to South African investors. Access Bank stands out for its accessibility, while Capitec Bank and FNB offer competitive rates for investors with larger sums to invest. When choosing among these options, consider your financial goals, risk tolerance, and available funds to make an informed decision about the best fixed deposit account for your needs.

Best 36 Months Fixed Deposit Rates 2023

1. Sasfin

Sasfin leads the pack with the highest nominal interest rate of 10.00% for a 36-month fixed deposit account. To take advantage of this rate, you’ll need a minimum deposit of R20,000. This rate translates to an effective annual rate of 10.47%, offering an attractive return for investors willing to commit their funds for three years. Sasfin’s offering is particularly appealing for those with a substantial initial investment.

2. Access Bank Plc

Access Bank Plc secures the second position with a competitive nominal interest rate of 9.80% for a 36-month fixed deposit, requiring a minimum deposit of R500. With an effective annual rate of 10.25%, this option provides a solid opportunity for individuals looking to grow their savings over the specified term. The lower minimum deposit makes it more accessible to a broader range of investors.

3. African Bank

African Bank rounds out the top three with a nominal interest rate of 9.67% for a 36-month fixed deposit, also demanding a minimum deposit of R500. The effective annual rate for this offer is 10.11%. While slightly lower than the top two options, it remains a competitive choice for those seeking a three-year investment. African Bank’s accessibility with its lower minimum deposit can be an advantage for many investors.

These top three fixed deposit rates in the 36-month category cater to investors with different financial capacities and preferences. Sasfin leads with a higher rate for those who can invest a substantial amount, while Access Bank Plc and African Bank offer competitive rates with lower minimum deposit requirements, making them accessible to a broader audience. When choosing among these options, consider your investment goals and the amount you can comfortably commit for three years.

Best 24 months fixed deposit rates

1. African Bank

African Bank secures the top position with an attractive nominal interest rate of 9.62% for a 24-month fixed deposit account. This option requires a minimum deposit of R500. The effective annual rate for this offering is 10.06%, making it an appealing choice for those looking to invest their savings over a two-year period. African Bank’s competitive rate combined with a reasonable minimum deposit opens up investment opportunities for a wide range of investors.

2. Access Bank Plc

Access Bank Plc follows closely with a nominal interest rate of 9.55% for a 24-month fixed deposit, with a minimum deposit requirement of R500. The effective annual rate for this option is 9.98%. Access Bank Plc’s offering provides a solid opportunity for individuals seeking a two-year investment with a competitive return. The lower minimum deposit requirement enhances its accessibility to a broader audience.

3. FNB

FNB takes the third spot with a nominal interest rate of 9.55% for a 24-month fixed deposit account, but with a higher minimum deposit requirement of R1 million. The effective annual rate is 9.98%. While FNB’s rate is competitive, the high minimum deposit may limit its appeal to a select group of investors with substantial resources. Nevertheless, for those who can meet the deposit requirement, it offers an attractive option for a two-year investment.

These top three fixed deposit rates in the 24-month category cater to a diverse range of investors. African Bank leads with a competitive rate and accessible minimum deposit, while Access Bank Plc offers a similar rate with a lower deposit requirement. FNB, with a higher rate but a significant minimum deposit, targets investors with more substantial funds. When selecting among these options, consider your investment goals, financial capacity, and the two-year investment horizon that suits your needs.

Best 12 months fixed deposit rates

1. TymeBank

TymeBank takes the lead with an exceptional nominal interest rate of 10.48% for a 12-month fixed deposit account. What makes this offering even more attractive is the incredibly low minimum deposit requirement of just R0.01, making it accessible to virtually anyone. With such a high-interest rate, TymeBank’s 12-month fixed deposit is an excellent choice for short-term savings or investments.

2. African Bank

African Bank secures the second position with a competitive nominal interest rate of 9.76% for a 12-month fixed deposit account. The minimum deposit requirement is R500.00, which is still relatively affordable for many investors. This offering provides a solid balance between a favourable interest rate and a reasonable deposit requirement, making it a versatile choice for those looking to grow their savings over the course of a year.

3. Sasfin

Sasfin comes in third with a nominal interest rate of 9.50% for a 12-month fixed deposit, requiring a minimum deposit of R20,000.00. While the interest rate is competitive, the higher minimum deposit might limit its accessibility to a select group of investors with larger sums to invest. Nevertheless, for those who can meet the deposit requirement, Sasfin’s 12-month fixed deposit offers a respectable return on investment.

These top three fixed deposit rates in the 12-month category cater to a diverse range of investors. TymeBank leads with an exceptionally high rate and a nearly negligible minimum deposit. African Bank provides a well-rounded option with a competitive rate and a reasonable deposit requirement. Sasfin offers a competitive rate but with a higher minimum deposit for investors with more substantial funds. When choosing among these options, consider your investment objectives, available funds, and your one-year investment horizon to make an informed decision.

Best 6 months fixed deposit rates

1. TymeBank

TymeBank claims the top spot with an attractive nominal interest rate of 9.8% for a 6-month fixed deposit. This offering is open to individuals aged 18 and older with a remarkably low minimum deposit requirement of just R1. What’s particularly noteworthy is the effective interest rate of 10.25%, which takes compounding into account. TymeBank’s 6-month fixed deposit is a compelling choice for those seeking short-term, high-yield savings options.

2. African Bank

African Bank secures the second position with a nominal interest rate of 9.11% for a 6-month fixed deposit. The minimum deposit requirement is R500, making it accessible to a broader range of investors. The effective interest rate of 9.5% is competitive and reflects the impact of compounding. African Bank’s offering provides a balanced combination of a reasonable minimum deposit and a competitive interest rate, suitable for short-term savings goals.

3. Access Bank Plc

Access Bank Plc takes the third spot with a nominal interest rate of 9.0% for a 6-month fixed deposit. However, it’s important to note that this rate is available for those willing to deposit a substantial sum, with a minimum requirement of R0.1. The effective interest rate of 9.38% reflects the compounding effect. Access Bank Plc’s 6-month fixed deposit is tailored to investors with significant capital looking for a short-term investment option.

These top three fixed deposit rates in the 6-month category cater to various investor profiles. TymeBank stands out with a high nominal interest rate and an incredibly low minimum deposit. African Bank offers a well-rounded choice with a competitive rate and accessible deposit requirement. Access Bank Plc provides an option for investors with substantial funds to invest over the short term. Consider your financial goals, available capital, and investment horizon when selecting the most suitable 6-month fixed deposit account.

Best 3 months fixed deposit rates

1. TymeBank

TymeBank leads the way with an attractive nominal interest rate of 8.93% for a 3-month fixed deposit. This offering is accessible to individuals aged 18 and older, with an exceptionally low minimum deposit requirement of just R1. The effective interest rate of 9.31% demonstrates the impact of compounding. TymeBank’s 3-month fixed deposit is a compelling choice for those looking for a short-term, high-yield savings option with minimal entry barriers.

2. Access Bank Plc

Access Bank Plc secures the second position with a nominal interest rate of 8.6% for a 3-month fixed deposit. However, it’s important to note that this rate is available for those willing to deposit a substantial sum, with a minimum requirement of R5 million. The effective interest rate of 8.95% takes compounding into account. Access Bank Plc’s 3-month fixed deposit is tailored to investors with significant capital seeking a short-term investment option.

3. Bidvest

Bidvest takes the third spot with a nominal interest rate of 8.46% for a 3-month fixed deposit. The minimum deposit requirement is R10,000, making it accessible to a wider range of investors compared to Access Bank Plc. The effective interest rate of 8.8% reflects the compounding effect. Bidvest’s 3-month fixed deposit offers a competitive rate and is suitable for those looking to invest a moderate sum over the short term.

These top three fixed deposit rates in the 3-month category cater to different investor profiles. TymeBank stands out with a high nominal interest rate and an extremely low minimum deposit. Access Bank Plc provides an option for investors with substantial funds for short-term investment, while Bidvest offers a competitive rate with a more accessible minimum deposit. Consider your financial goals, available capital, and investment horizon when choosing the most suitable 3-month fixed deposit account.

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 favored 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)

1. What is a fixed deposit account?
   • A fixed deposit account, also known as a term deposit account, is a savings account offered by banks and financial institutions. It offers a fixed interest rate over a specified period, providing a secure way to grow your savings.
2. How do fixed deposit accounts work?
   • When you open a fixed deposit account, you deposit a specific amount of money for a predetermined period at a fixed interest rate. The interest rate remains constant throughout the agreed-upon term, ensuring stable returns.
3. What is the minimum duration for a fixed deposit account in South Africa?
   • The minimum duration for a fixed deposit account in South Africa is typically 3 months.
4. Can I withdraw my funds from a fixed deposit account before the maturity date?
   • Yes, you can withdraw your funds before the maturity date, but it may result in penalties or a reduction in the interest earned. The penalties vary by bank and account terms.
5. Is the interest earned on a fixed deposit account taxable?
   • Yes, interest earned on a fixed deposit account is generally subject to income tax in South Africa. You should declare it as part of your taxable income.
6. Are fixed deposit accounts safe?
   • Fixed deposit accounts are considered safe because they offer capital protection. Your initial deposit, along with the interest, is guaranteed, provided you adhere to the account terms.
7. What is the difference between nominal interest rate and effective interest rate?
   • The nominal interest rate is the interest rate stated by the bank. The effective interest rate, also known as the annual percentage yield (APY), takes compounding into account and reflects the actual return on your investment.
8. Can I get monthly interest payouts from a fixed deposit account?
   • Some banks offer monthly interest payouts on fixed deposit accounts, but this depends on the specific account terms. Be sure to check with your bank.
9. What happens if I miss the maturity date of my fixed deposit account?
   • If you miss the maturity date, your bank may automatically renew the fixed deposit for the same duration or transfer it to a standard savings account. It’s essential to communicate with your bank if you have specific plans.
10. Are there any fees associated with fixed deposit accounts?
    • Some banks may charge fees, such as account opening or maintenance fees, early withdrawal penalties, or charges for accessing interest payments before maturity. Review the terms and conditions of your account.
11. Can I have multiple fixed deposit accounts at the same bank?
    • Yes, many banks allow customers to open multiple fixed deposit accounts with different terms and interest rates.
12. Do fixed deposit accounts offer joint account options?
    • Yes, fixed deposit accounts often offer joint account options, allowing multiple individuals to invest together.
13. Is there a maximum limit to the amount I can deposit in a fixed deposit account?
    • The maximum deposit limit varies by bank and account type. Some accounts may have higher limits for larger investments.
14. What should I consider when choosing a fixed deposit account?
    • When selecting a fixed deposit account, consider factors such as the interest rate, minimum deposit requirement, maturity date, penalties for early withdrawal, and the interest payout frequency.
15. Is it possible to add additional funds to an existing fixed deposit account?
    • Generally, you cannot add funds to an existing fixed deposit account. However, you can open a new fixed deposit account with additional funds if needed.
16. What is the minimum period for a fixed deposit?
    • The most common minimum period for a fixed deposit in South Africa is 3 months.
17. Which bank has the highest FD interest rates in South Africa?
    • TymeBank has the best fixed deposit rate for 2023, with a rate of 11%, followed by Access Bank and SA Retail Bonds, with 10.97% and 10.50% interest rates respectively.
18. Can I get monthly interest on a fixed deposit?
    • Yes,fixed deposit interest can be paid monthly, however this is mostly dependent on the institution with which you have an account. Some institutions may agree to pay you interest on a monthly basis after your fixed deposit has been held for a certain period of time. Some may be able to do so only after the maximum duration has elapsed. In essence, some banks are flexible while others are not; you should contact your preferred bank for further information.
19. Can you lose money in a Fixed Deposit?
    • In general, you do not lose your principal investment in a fixed deposit (FD) account. FDs are considered one of the safest investment options because they offer capital protection. This means that the initial amount you deposit (the principal) is secure and will be returned to you at the end of the FD’s maturity period, provided you adhere to the account terms.
    • However, there are a few important considerations to keep in mind:
      • Inflation: While your principal is protected, FDs may not always keep pace with inflation. If the interest rate on your FD is lower than the rate of inflation, the purchasing power of your returns may be eroded over time. In other words, your money may not grow enough to maintain its real value.
      • Opportunity Cost: When you invest in an FD, your money is tied up for a specific period, and you may miss out on potentially higher returns from other investments, such as stocks or mutual funds.
      • Penalties for Early Withdrawal: If you withdraw your funds from an FD before the maturity date, you may incur penalties, and the interest earned could be reduced. This is why it’s essential to carefully consider the duration of your FD investment.

Conclusion

Fixed deposit accounts remain an attractive option for South African investors seeking security and guaranteed returns. To make the most of your investment, carefully consider the duration, interest rate, and minimum balance requirement of each fixed deposit account. Additionally, remember to assess your individual financial goals and risk tolerance before making your investment choice. By choosing the right fixed deposit account, you can secure your savings and enjoy a steady flow of income while safeguarding your financial future.