Bank Rates, Bank Interest Rate, Bank Deposit Rates

A bank rate is the interest rate that is charged by a country’s central or federal bank on loans and advances to control money supply in the economy and the banking sector. This is typically done on a quarterly basis to control inflation and stabilize the country’s exchange rates. A fluctuation in bank rates triggers a ripple-effect as it impacts every sphere of a country’s economy. For instance, the prices in stock markets tend to react to interest rate changes. A change in bank rates affects customers as it influences prime interest rates for personal loans.

Types of Bank Rates

Here are the different types of monetary instruments on which financial institutions offer the following bank rates:

Savings account bank rate: Modest rates are charged on funds that are deposited in the savings accounts. However, investors have high flexibility in withdrawing the deposits.

Certificates of deposit (CD) bank rate: These offer comparatively high interest rates compared to savings accounts. Bank rates on CDs are determined by the term period of a deposit and the current economic situation. The longer the term of a CD, the higher will be the bank interest rate.

Money-market funds bank rate: The interest rate on money-market funds is relatively low. As most of the money market accounts are privately insured, it is a secure method of investment. Deposits in a money market account generate interest through short-term investments.

How to Find Information about Bank Interest Rates

Here are some reliable websites where buyers can find the latest information on bank interest rates:

Bankrate.com is a website that provides comprehensive information on interest rates for various financial products like savings accounts, CDs, loans, mortgages and credit cards.

Bankaholic.com is another site that contains data and necessary information about interest rates in the US banks. It lets users search and compare interest rates for CDs, savings accounts and money market accounts spanning various financial institutions.

Another site called Moneyaisle.com enables participating financial institutions to bid and offer the best rates. As the live auction takes off, users can watch these bidding rounds and choose the institution that he/she wants to invest in.