What Is a Deposit Interest Rate?

The deposit interest rate is the ratio of the amount of interest to the amount of deposit over a certain period of time. Also called deposit interest rate. Is the standard for calculating interest on deposits. There are annual interest rate, monthly interest rate, and daily interest rate (also called annual interest rate, monthly interest rate, and daily interest rate). The annual interest rate is expressed as a few percent of the principal, the monthly interest rate is expressed as a few thousandths of the principal; the daily interest rate is expressed as a few thousandths of the principal. China is accustomed to calling interest rates a few cents. Deposit interest rate is an economic lever for banks to absorb deposits, and it is also an important factor affecting bank costs. China's deposit interest rate is determined by the state in a planned manner based on objective economic conditions, currency circulation, and market supply and demand, and taking into account the interests of all parties. ^[1]

Deposit interest rate

The deposit interest rate is the ratio of the amount of interest to the amount of deposit over a certain period of time. Also called deposit interest rate. Is the standard for calculating interest on deposits. There are annual interest rate, monthly interest rate, and daily interest rate (also called annual interest rate, monthly interest rate, and daily interest rate). The annual interest rate is expressed as a few percent of the principal, the monthly interest rate is expressed as a few thousandths of the principal; the daily interest rate is expressed as a few thousandths of the principal. China is accustomed to calling interest rates a few cents. Deposit interest rate is an economic lever for banks to absorb deposits, and it is also an important factor affecting bank costs. China's deposit interest rate is determined by the state in a planned manner based on objective economic conditions, currency circulation, and market supply and demand, and taking into account the interests of all parties. ^[1]

2011 Bank of China Deposit Interest Rate Table

I. Deposits of urban and rural residents and units
(1) Current deposit	0.50
(2) Full deposit and withdrawal
Three months	3.10
Half a year	3.30
One year	3.50
Two years	4.40
Three years	5.00
Five years	5.50
Second, various loans
Six months	6.10
One year	6.56
One to three years	6.65
Three to five years	6.90
More than five years	7.05
Personal housing provident fund loan
Less than five years (including five years)	4.45
More than five years	4.90

Calculation formula

Repayment per period = principal per period + interest per period

Deposits can be classified according to various methods. For example, they can be divided into original deposits and disbursements according to production methods, current deposits and time deposits according to maturity. According to different depositors (in the case of China), they can be divided into unit deposits And personal deposits. Personal deposits are resident savings deposits, and are the currency in which individuals deposit into the bank. Unit deposit

Corporate deposits. This is a state-owned enterprise, a supply and marketing cooperative, and a collective industrial enterprise. The temporary idle currency funds generated due to the inconsistency of the sales income with the time of various expenditures, and also include various special funds that have been withdrawn but not used by the enterprise. The most important of these are Fixed asset depreciation funds also include retained profits. The changes in corporate deposits depend on the scale of the company s production and purchase of products and business management conditions. As production or commodity circulation expands, corporate deposits increase and vice versa, while business management improves and capital turnover accelerates, corporate deposits decrease, and vice versa. . The vast majority of corporate deposits are demand deposits, and only a few are term deposits.

Financial deposits. Banks act as the national treasury, and all financial revenues and expenditures must be handled through banks (see National Treasury System). Fiscal revenue and expenditure are often inconsistent in time. In the case of receiving first and paying later, temporarily unused funds form a fiscal deposit.

Capital construction deposits Deposits formed from funds not used for capital construction

Deposits from institutions, groups, and troops. It is a deposit formed by the above-mentioned units from the fiscal concentration to obtain unused funds.

Rural deposits. Collective agriculture, township and village enterprises, and rural credit cooperatives have bank deposits, of which rural credit cooperatives account for more than 90%.

New types of deposits in the world are constantly appearing, such as negotiable large-term deposit certificates, negotiable payment order accounts, telephone transfer services and automatic transfer services, money market depositors, etc. Among them, negotiable large-term deposit certificates are also available in China development of. Time deposit

Refers to a deposit that can be withdrawn by a depositor within a specified date after the deposit or must be notified to the bank several days before the withdrawal is prepared, and the term can range from 3 months to 5 years, ranging from 10 years or more. Generally speaking, the longer the deposit term, the higher the interest rate. Traditional time deposits have the form of a certificate of deposit, as well as a passbook. The latter is also called a passbook time deposit, but it takes 90 days as the basic interest-bearing days. Compared with demand deposits, time deposits are more stable and have lower operating costs. The deposit reserve ratio held by commercial banks for this purpose is correspondingly lower. Therefore, the utilization rate of time deposits is often higher than that of demand deposits. deposit.

Time deposits are deposits in which the bank and the depositor agree on a time limit and interest rate in advance, and withdraw principal and interest after maturity. Time deposits are used to settle or withdraw cash from time deposit accounts. Customers who need funds temporarily can handle early withdrawal or partial early withdrawal. Current deposit

Refers to a type of bank deposit that depositors can access and transfer at any time without any prior notice, in the form of checking deposit accounts, guaranteed checks, cashier's checks, travel checks and letters of credit. Demand deposits account for the largest portion of a country's money supply and are also an important source of funds for commercial banks. In view of the fact that demand deposits not only have the functions of currency payment and circulation means, but also have strong derivation capabilities, commercial banks must take demand deposits as the focus of their operations at all times. However, due to the frequent deposit and withdrawal of such deposits, the complicated procedures and high costs, commercial banks in western countries generally do not pay interest, and sometimes even charge a certain fee. Notice deposit

The notice deposit is a deposit that does not have an agreed deposit period, and the bank must be notified in advance when the withdrawal is made, and the withdrawal date and amount can be agreed before the withdrawal can be made.

Regardless of the actual deposit period, individual notice deposits are divided into two types: one-day notice deposits and seven-day notice deposits according to the length of the notice period of the depositors. One day's notice of deposits must be notified one day in advance of the agreed amount of deposits, and seven days' notice of deposits must be notified seven days in advance of the amount of agreed deposits. The minimum minimum deposit, minimum withdrawal and minimum retention amount for RMB notification deposits are 50,000 yuan, and the minimum minimum deposit amount for foreign currency is USD 1,000 equivalent foreign currency (for the minimum deposit amount of each bank, please consult your local bank).

The currency of the notice deposit can be Renminbi, Hong Kong dollar, British pound, US dollar, Japanese yen, Euro, Swiss franc, Australian dollar, Singapore dollar (please contact your local bank for the specific business and currency of each province). The interest rates for Renminbi and foreign currency deposits for notice deposits are higher than the interest rates for demand deposits, which are subject to the regulations of each bank.

How to apply

Hold your ID card at a bank outlet, open an account that can be connected to the notification deposit and deposit a certain amount (usually more than 50,000). Selecting a notification deposit can not only earn higher interest than a demand deposit, but also get back funds in a short period of time. It is more suitable for people who have a large amount of idle funds in a short period of time, but also need irregular funds.

according to

The People's Bank of China has decided to reduce the benchmark interest rates for RMB loans and deposits of financial institutions from October 24, 2015 to further reduce social financing costs. Among them, the benchmark one-year loan interest rate of financial institutions was reduced by 0.25 percentage points to 4.35%; the benchmark one-year deposit interest rate was reduced by 0.25 percentage points to 1.5%; other benchmark loans and deposit interest rates, and the People's Bank of China s lending rates for financial institutions were adjusted accordingly. ; The personal housing provident fund loan interest rate remains unchanged. At the same time, it will no longer set a floating upper limit on deposit interest rates for commercial banks and rural cooperative financial institutions, and step up efforts to improve the market-oriented formation and regulation mechanism of interest rates, strengthen the central bank's regulation and supervision of the interest rate system, and improve the efficiency of monetary policy transmission. ^[2]