Barclays Bank of Botswana has introduced an upfront fixed deposit account to cater for consumers who want to receive interest upfront when opening an account.
An upfront-fixed deposit is a financial instrument by which a bank depositor agrees to lodge a fixed sum of funds with the bank for a fixed period at a fixed rate of interest.
The money is usually fixed at the time the deposit is made. Speaking to BusinessWeek, Barclays’ retail client relations manager, Brighton Banda said they decided to come up with the concept after realising that there is a growing demand for fixed deposits accounts in the country. “This desire was accompanied by a strong desire for more flexibility by customers and this required us as a bank to re-look the financial engineering of the product within our portfolio for all our customers,” he said. Through this account, customers can save a minimum of P100,000 for a period of 12 to 36 months and get a minimum of three percent interest pay. According to Banda, this account target pensioners, as it will help them take care of emergencies without eroding their saved capital.
He added that this enhancement caters for clients with a different cashflow profile or needs not met by other term deposits, which he said highlights their positioning as a bank to help their clientele save for tomorrow and ultimately plan ahead and prosper. “In the face of liquidity challenges, change to incorporate flexibility is imperative adding that this solution will be suitable for those clients who would rather not wait to receive their interest at maturity periodically,” he said. According to Banda, they identify themselves as a customer focused bank that develops needs based products. “Some clients may also have a cashflow profile best catered for by this solution; this referring to a high cash balance, but minimal current obligations coupled with a large obligation at a later date,” he said.
In addition, the bank has also introduced other financial solutions in the investment sector. These include; monthly fixed deposit, multi-units fixed deposits and fixed deposits accounts. This is part of Barclays’ strategy to be the go-to bank. Earlier this year, it introduced a number of digital innovations to improve customer service by unveiling paperless banking.
Other innovations include remote account opening, cash deposit ATM’s as well as virtual e-wallet.