Bank Deposit Interest Rates Continue to Decline

Bank deposit interest rates continue to decline. Bank Indonesia (BI) recorded an average deposit interest rate for general banks (12-month maturity) of 4.59% in July 2021.

This figure is 6 basis points (bps) lower than the previous month's 4.65%. Compared to December 2020, the average deposit interest rate (12-month maturity) for general banks has fallen by 110 bps.

Despite the decline, deposit interest rates still offer a profit considering inflation. The Central Bureau of Statistics (BPS) recorded an annual inflation rate of 1.52% in July 2021. This means there was a net interest margin of 307 bps between deposit interest and inflation that month.

Rupiah-denominated deposits totaled Rp 2.42 quadrillion at the end of July 2021. Of this amount, deposits with a 12-month maturity totaled Rp 219.09 trillion (9.07%). Meanwhile, deposits with a 3-month maturity reached Rp 1.03 quadrillion (42.61%).

Regional Development Banks (BPDs) recorded the highest deposit interest rate (12-month maturity) at 5.45% per year, or 86 bps above the average for general banks. Domestic private banks offered a deposit interest rate (12-month maturity) of 4.62% per year, or 3 bps above the general bank average.

The deposit interest rate (12-month maturity) for foreign/mixed banks was 4.1% per year, or 49 bps below the general bank average. Meanwhile, the deposit interest rate (12-month maturity) for state-owned banks was only 3.65% per year, or 94 bps below the general bank average.