The country’s financial landscape has gone through a shift in recent years, especially in terms of people’s savings behaviour, as many prefer digital platforms for savings and investments to conventional savings methods, such as keeping money in banks, post office, clay banks or at home.

Besides, recently people are getting more drawn to investing in mutual funds, bonds, stocks, and real estates, instead of choosing the older method of buying gold to use their surplus money.

In rural areas, where traditional banking infrastructure is often limited, mobile wallets and digital savings platforms have allowed individuals to save securely and with ease.

With the penetration of smartphones and the internet, Bangladesh has seen a surge in mobile banking and fintech services. Mobile financial services like bKash, Rocket, and Nagad have revolutionised the way people in Bangladesh conduct financial transactions, including savings.

This digital shift has enhanced financial inclusion, enabling a larger segment of the population, particularly the unbanked, to access savings products and services that were once out of reach.

This shift has allowed the unbanked population to enter the formal financial system, offering them an easy way to store money and conduct transactions. The rising middle class, particularly in urban areas, has more disposable income than before, which is driving the shift toward more formalised savings methods. This group is now looking for ways to save and invest money beyond traditional means, and they are becoming increasingly aware of the importance of long-term financial planning.

The government has played a key role in shaping the savings landscape through various savings schemes, incentives and policies. These schemes are supported by the government, banks, and various financial institutions, providing citizens with an opportunity to build wealth, save for emergencies, or fund specific goals such as education or retirement.

Dr Zahid Hussain, former lead economist of the World Bank’s Dhaka office, told the Daily Sun that rising inflation has inflicted economic hardship on many, but inflation has started to decline. So the government may focus on expanding financial literacy programmes which would contribute to developing a more informed public which is better equipped to make decisions about saving and investing. As Bangladesh continues to push for economic development and financial inclusion, government policies aimed at improving access to savings products will play an essential role in the changing landscape.

On the other hand, the use of digital wallets and savings apps will become even more widespread, with enhanced features like AI-based financial advice, automated savings programmes, and easy access to investment opportunities, he added.

AB Mirza Azizul Islam, former adviser to the caretaker government, said, “In our country, people have no place to move away from the banks. There is virtually no alternative destination for savings or investments. So every bank should take steps to improve the digital platforms. As digital platforms proliferate, financial literacy programmes will continue to expand, allowing more people to make informed decisions about how and where to save and invest.

Meanwhile, with improved access to information and trading platforms, a larger portion of the population will likely begin investing in equities, bonds, and mutual funds. Investment education will become more accessible, and financial markets will continue to grow, he added.

Talking to the Daily Sun, Md Arfan Ali, former president and managing director of the Bank Asia, said, “There are several barriers to saving, and these need to be removed to make the process easier. It is essential to ensure that people can deposit any amount of money into their accounts without restrictions. Additionally, there should be increased awareness regarding the digital platforms of banks. Promoting better understanding and usage of these platforms can make saving more accessible and convenient for everyone, particularly in today’s digital age.”

Money deposit in banks through ups and downs

At one time, the interest or profit earned from depositing money in the bank was sufficient to cover the expenses of maintaining the bank account, with a small surplus left over. However, at a certain point, the interest rate on bank deposits fell below the inflation rate. As a result, many customers became discouraged from using banks. This situation is believed to have occurred due to the government’s directive to keep loan interest rates capped by the Bangladesh Bank.

Now, the cap on interest rates has been lifted, and the interest on bank deposits has started to rise. Some banks are even offering higher interest rates than savings bonds and certificates. As a result, many depositors have started returning to the banks.

The practice of depositing a fixed amount of money every month is known as the Monthly Savings Scheme or DPS (Deposit Pension Scheme). Although DPS is a commonly recognised term, it is known by different names in various banks. Commercial banks offer different types of interest or profit options for the DPS, such as monthly, quarterly, semi-annual, or annual payments. Furthermore, banks allow customers to save for periods ranging from a minimum of three months to three years or even longer.

The interest earned on these savings is referred to as the Fixed Deposit Rate or FDR. According to the most recent data of December 2024, as analyzed by the central bank, the interest rates offered by 61 banks in the country are not uniform. The rates on FDRs range from 3% to a maximum of 13%, depending on the duration of the deposit.

According to the central bank’s data, there are a total of 9 state-owned banks in the country, of which three are specialised banks. These government-owned banks are offering interest rates on FDR (Fixed Deposit Rates) ranging from 3% to a maximum of 10.5% for various tenures. For regular deposits, they offer 3% to 6% interest.

The private banks are offering 2% to 8% interest on general savings deposits and 4% to 11% on term deposits. However, some banks are offering up to 12% to 13% interest on term deposits.

Among the country’s full-fledged Shariah-compliant Islamic banks, profit rates are between 9% and 11%.

Foreign banks, on the other hand, generally collect fewer deposits, and their interest rates are relatively low. Most of the foreign banks offer interest on term deposits in the range of 4% to 9%.

Besides, many people also deposit money in non-banking financial institutions.

National Savings schemes in Bangladesh

National Savings Certificates are one of the most popular and widely utilised savings schemes in Bangladesh. They are government-backed, low-risk investment instruments designed to encourage savings. There are various types of NSCs available with different tenures and interest rates.

The savings instruments include the five-year Bangladesh savings certificate, the three-monthly profit-bearing Sanchayapatra, the five-year family savings certificate and the five-year pensioners’ savings certificate. To make these instruments more attractive to savers, the interim government has increased interest rates on various national savings certificates to upwards of 12%.

Under the new system, the interest rate on the five-year Bangladesh savings certificate will be 12.4% for investments up to Tk7.5 lakh. For savings above Tk7.5 lakh, the interest rate will be 12.37%.

In the case of the three-monthly profit-bearing Sanchayapatra, the potential profit rate for investments up to Tk7.5 lakh will be 12.30%. For investments exceeding this amount, the profit rate will be 12.25%.

For the family savings instrument, the interest rate will be 12.5% for investments up to Tk7.5 lakh. For savings above Tk7.5 lakh, the interest rate will be 12.37%.

Similarly, the profit rate for 5-year pensioner savings certificates for investments up to Tk7.5 lakh will be 12.55%. For investments exceeding this amount, the rate will be 12.37%.

Meanwhile, interest rates on savings instruments for expatriate Bangladeshis are 12% for the wage earners’ bond, 6.5% for the US dollar investment bond and 7.5% for the US dollar premium bond.

The interest rate on post office term deposits ranges from 12.30% to 12.25%.

Shift from traditional savings to investments

Traditionally, savings in Bangladesh were confined to low-interest savings accounts or physical forms of savings, such as gold and cash stored at home. However, there is a growing trend toward investment products like mutual funds, bonds, stocks, and real estate as people seek higher returns on their money.

The younger generation, in particular, is increasingly investing in equities, stock markets, and even cryptocurrencies. Online platforms and mobile apps have made it easier for people to access investment opportunities, and financial literacy has risen, with more people understanding the importance of diversifying their portfolios to achieve long-term financial goals.

Different regulatory bodies have also been working to create a more transparent and efficient investment environment. As a result, people are more confident in entering the stock market, mutual funds, and real estate investment.