Fixed Deposit - V2 Configuration

Product Type: Term Deposit with Fixed Returns
Use Case: Guaranteed returns, capital preservation, investment
Minimum Amount: ₦100,000 - ₦1,000,000
Typical Tenor: 30 days - 5 years
Interest Rate: 6% - 14% per annum (tenor & amount based)

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Overview

Fixed deposits (FD) are term deposit accounts offering guaranteed interest returns for a specified period. Funds are locked for the tenor with penalties for early liquidation. Ideal for risk-averse investors seeking predictable returns.

Key Features

• Guaranteed Returns: Fixed interest rate for entire tenor
• Tenor-Based Rates: Longer tenors earn higher rates
• Amount-Based Bonuses: Larger deposits get rate premiums
• Early Liquidation: Allowed with penalties
• Auto-Renewal Option: Rollover at maturity
• Loan Collateral: Can be used as loan security (90% LTV)
• No Transaction Fees: Set-and-forget investment

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YAML Field Reference

Basic Information Section

Field Name	Data Type	Required	Description	Example
productCode	String	✅ Yes	Unique product code	"FD-STANDARD-001"
productName	String	✅ Yes	Display name	"Standard Fixed Deposit"
description	String	No	Product description	"Term deposit with guaranteed returns"
isActive	Boolean	No	Product status	true
depositAccountType	String	✅ Yes	Account type	"FixedDeposit"
lineOfBusiness	Enum	No	Business classification	"Retail" or "Commercial"

Deposit Amount Configuration

Field Name	Data Type	Required	Description	Example
minimumAmount	Decimal	✅ Yes	Minimum deposit	100000
maximumAmount	Decimal	No	Maximum deposit (0 = unlimited)	0
amountIncrements	Decimal	No	Deposit must be in multiples of	50000

Tenor Configuration Section

Field Name	Data Type	Required	Description	Example
minimumTenorDays	Integer	✅ Yes	Minimum term	30
maximumTenorDays	Integer	✅ Yes	Maximum term	1825
allowedTenors[]	Array	No	Specific allowed tenors (days)	[30, 60, 90, 180, 365, 730]
tenorUnit	Enum	No	Display unit	"Days" or "Months" or "Years"

Interest Rate Configuration

Field Name	Data Type	Required	Description	Example
isEnabled	Boolean	✅ Yes	Whether interest is paid	true
calculationMethod	Enum	✅ Yes	Calculation approach	"Simple" or "Compound"
paymentFrequency	Enum	✅ Yes	Interest payment schedule	"Maturity" or "Monthly" or "Quarterly"
rateType	Enum	✅ Yes	Rate structure	"Fixed"

Tenor-Based Interest Rates

Field Name	Data Type	Required	Description	Example
tenorRates[]	Array	✅ Yes	Rates by tenor bands	See below
tenorRates[].fromDays	Integer	✅ Yes	Tenor start (days)	30
tenorRates[].toDays	Integer	No	Tenor end (null = unlimited)	89
tenorRates[].rate	Decimal	✅ Yes	Interest rate (%)	6.0

Example Tenor-Based Rates:

tenorRates:
  - fromDays: 30
    toDays: 89
    rate: 6.0
  - fromDays: 90
    toDays: 179
    rate: 8.0
  - fromDays: 180
    toDays: 364
    rate: 10.0
  - fromDays: 365
    toDays: null
    rate: 12.0

Amount-Based Rate Bonuses

Field Name	Data Type	Required	Description	Example
amountBonuses[]	Array	No	Additional rates for larger amounts	See below
amountBonuses[].fromAmount	Decimal	✅ Yes	Amount threshold	5000000
amountBonuses[].toAmount	Decimal	No	Amount ceiling	10000000
amountBonuses[].bonusRate	Decimal	✅ Yes	Additional rate (%)	1.0

Example:

amountBonuses:
  - fromAmount: 5000000
    toAmount: 9999999
    bonusRate: 1.0  # +1% for ₦5M-₦10M
  - fromAmount: 10000000
    toAmount: null
    bonusRate: 1.5  # +1.5% for ₦10M+

Early Liquidation Configuration

Field Name	Data Type	Required	Description	Example
allowEarlyLiquidation	Boolean	✅ Yes	Permit premature withdrawal	true
penaltyType	Enum	No	Penalty calculation method	"ReducedRate" or "PenaltyFee"
reducedRatePercentage	Decimal	No	% of original rate if liquidated early	50
penaltyFeePercentage	Decimal	No	% of interest as penalty	30
minimumHoldingDays	Integer	No	Cannot liquidate before X days	7

Auto-Renewal Configuration

Field Name	Data Type	Required	Description	Example
allowAutoRenewal	Boolean	No	Enable automatic rollover	true
autoRenewalDefault	Boolean	No	Auto-renew by default	false
rolloverPrincipalOnly	Boolean	No	Exclude interest from rollover	false
rolloverPrincipalAndInterest	Boolean	No	Include interest in new principal	true
notifyBeforeMaturity	Boolean	No	Alert before maturity	true
notificationDaysBefore	Integer	No	Days before maturity	7

Loan Collateral Configuration

Field Name	Data Type	Required	Description	Example
allowAsLoanCollateral	Boolean	No	Can secure loans	true
collateralLTV	Decimal	No	Max loan-to-value (%)	90
restrictAccessWhenPledged	Boolean	No	Cannot liquidate if pledged	true

Fees Configuration Section

Field Name	Data Type	Required	Description	Example
placementFee	Decimal	No	Fee to create FD	0
earlyLiquidationFee	Decimal	No	Flat fee for early closure	1000
certificateIssuanceFee	Decimal	No	FD certificate fee	500

Eligibility Configuration Section

Field Name	Data Type	Required	Description	Example
minimumAge	Integer	No	Minimum age	18
allowCorporateDeposits	Boolean	No	Corporate FDs allowed	true
allowIndividualDeposits	Boolean	No	Personal FDs allowed	true
requiredDocuments[]	Array	✅ Yes	Mandatory documents	["ValidID", "BVN", "SourceOfFunds"]
kycLevel	Enum	No	Required KYC tier	"Tier2"

Notifications Configuration Section

Field Name	Data Type	Required	Description	Example
sendPlacementConfirmation	Boolean	No	Confirm FD creation	true
sendMaturityReminder	Boolean	No	Maturity notification	true
sendRenewalConfirmation	Boolean	No	Confirm auto-renewal	true
channels.sms	Boolean	No	Enable SMS	true
channels.email	Boolean	No	Enable email	true

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Complete Sample YAML Configuration

basicInfo:
  productCode: "FD-STANDARD-001"
  productName: "Standard Fixed Deposit"
  description: "Term deposit with guaranteed returns - 30 days to 5 years"
  isActive: true
  depositAccountType: "FixedDeposit"
  lineOfBusiness: "Retail"
  currencyCode: "NGN"

depositAmountConfig:
  minimumAmount: 100000
  maximumAmount: 0  # Unlimited
  amountIncrements: 50000

tenorConfig:
  minimumTenorDays: 30
  maximumTenorDays: 1825  # 5 years
  allowedTenors:
    - 30    # 1 month
    - 60    # 2 months
    - 90    # 3 months
    - 180   # 6 months
    - 365   # 1 year
    - 730   # 2 years
    - 1095  # 3 years
    - 1825  # 5 years
  tenorUnit: "Days"

interestConfig:
  isEnabled: true
  calculationMethod: "Simple"
  paymentFrequency: "Maturity"
  rateType: "Fixed"

tenorBasedRates:
  - fromDays: 30
    toDays: 89
    rate: 6.0
  - fromDays: 90
    toDays: 179
    rate: 8.0
  - fromDays: 180
    toDays: 364
    rate: 10.0
  - fromDays: 365
    toDays: 729
    rate: 12.0
  - fromDays: 730
    toDays: null
    rate: 14.0

amountBasedBonuses:
  - fromAmount: 5000000
    toAmount: 9999999
    bonusRate: 1.0
  - fromAmount: 10000000
    toAmount: null
    bonusRate: 1.5

earlyLiquidationConfig:
  allowEarlyLiquidation: true
  penaltyType: "ReducedRate"
  reducedRatePercentage: 50
  minimumHoldingDays: 7

autoRenewalConfig:
  allowAutoRenewal: true
  autoRenewalDefault: false
  rolloverPrincipalOnly: false
  rolloverPrincipalAndInterest: true
  notifyBeforeMaturity: true
  notificationDaysBefore: 7

loanCollateralConfig:
  allowAsLoanCollateral: true
  collateralLTV: 90
  restrictAccessWhenPledged: true

fees:
  placementFee: 0
  earlyLiquidationFee: 1000
  certificateIssuanceFee: 500

eligibilityConfig:
  minimumAge: 18
  allowCorporateDeposits: true
  allowIndividualDeposits: true
  requiredDocuments:
    - "ValidID"
    - "BVN"
    - "SourceOfFunds"
    - "ProofOfAddress"
  kycLevel: "Tier2"

notificationsConfig:
  sendPlacementConfirmation: true
  sendMaturityReminder: true
  sendRenewalConfirmation: true
  channels:
    sms: true
    email: true
    push: true

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Use Cases & Examples

Example 1: Standard 6-Month Fixed Deposit

Scenario: Individual wants to invest ₦1,000,000 for 6 months.

Configuration:

depositAmount: ₦1,000,000
tenor: 180 days
rate: 10% p.a.

Return Calculation:

Principal: ₦1,000,000
Rate: 10% per annum
Tenor: 180 days

Simple Interest = Principal × Rate × (Days / 365)
Interest = ₦1,000,000 × 10% × (180 / 365)
Interest = ₦49,315

Maturity Value: ₦1,049,315

Example 2: High-Value 1-Year Deposit with Bonus

Scenario: Corporate entity deposits ₦15,000,000 for 1 year.

Rate Calculation:

tenorBasedRates:
  365 days: 12.0%

amountBasedBonuses:
  ₦10M+: +1.5%

Total Rate: 12.0% + 1.5% = 13.5%

Return Calculation:

Principal: ₦15,000,000
Rate: 13.5% p.a.
Tenor: 365 days

Interest = ₦15M × 13.5%
Interest = ₦2,025,000

Maturity Value: ₦17,025,000

Monthly Equivalent: ₦168,750/month

Example 3: Early Liquidation Scenario

Scenario: Customer needs funds after 90 days of 365-day FD.

Original Terms:

principal: ₦2,000,000
tenor: 365 days
rate: 12%
expectedInterest: ₦240,000

Early Liquidation (Reduced Rate Method):

penaltyType: "ReducedRate"
reducedRatePercentage: 50  # 50% of original rate

Calculation:

Original Rate: 12%
Reduced Rate: 12% × 50% = 6%

Held For: 90 days
Interest Earned: ₦2M × 6% × (90/365) = ₦29,589

Maturity Value: ₦2,029,589

Lost Interest: ₦240,000 - ₦29,589 = ₦210,411

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Interest Calculation Methods

Simple Interest (Most Common for FD)

calculationMethod: "Simple"

Formula:

Interest = Principal × Rate × (Tenor / 365)

Example:
  Principal: ₦5,000,000
  Rate: 10%
  Tenor: 180 days
  
  Interest = ₦5M × 10% × (180 / 365)
  Interest = ₦246,575

Compound Interest (Rare for FD)

calculationMethod: "Compound"
paymentFrequency: "Quarterly"

Formula:

A = P(1 + r/n)^(nt)
Where:
  A = Maturity amount
  P = Principal
  r = Annual rate
  n = Compounding frequency (4 for quarterly)
  t = Time in years

Example:
  Principal: ₦5,000,000
  Rate: 10%
  Tenor: 365 days (1 year)
  Quarterly compounding
  
  A = ₦5M × (1 + 0.10/4)^(4×1)
  A = ₦5M × (1.025)^4
  A = ₦5M × 1.10381
  A = ₦5,519,050
  
  Interest: ₦519,050 (vs ₦500,000 simple interest)

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Tenor-Based Rate Structure

tenorBasedRates:
  30-89 days: 6%
  90-179 days: 8%
  180-364 days: 10%
  365-729 days: 12%
  730+ days: 14%

Rate Progression Logic:

Longer Tenor = Higher Rate
  - Bank has certainty of funds
  - Can lend for longer periods
  - Rewards customer for locking funds

Typical Increments:
  Every 90 days: +1-2%
  1 year milestone: +2-3%
  2+ years: +1-2% additional

Example Rate Comparison:

₦1,000,000 Investment:

30 days (6%):
  Interest = ₦4,932
  Annual Equivalent = ₦60,000

180 days (10%):
  Interest = ₦49,315
  Annual Equivalent = ₦100,000

365 days (12%):
  Interest = ₦120,000
  Annual Equivalent = ₦120,000

730 days (14%):
  Interest = ₦280,000 (2 years)
  Annual Equivalent = ₦140,000

Observation: Diminishing returns for very long tenors

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Amount-Based Rate Bonuses

amountBasedBonuses:
  ₦5M-₦10M: +1.0%
  ₦10M+: +1.5%

Combined Rate Example:

Customer: ₦12,000,000 for 365 days

Base Rate (365 days): 12.0%
Amount Bonus (₦10M+): +1.5%
Total Rate: 13.5%

Interest = ₦12M × 13.5%
Interest = ₦1,620,000

Without Bonus: ₦12M × 12% = ₦1,440,000
Bonus Value: ₦180,000 additional

Threshold Planning:

Customer has ₦9,500,000:
  Current Rate: 12% (no bonus)
  Interest: ₦1,140,000

Add ₦500,000 to reach ₦10M:
  New Rate: 13.5% (+1.5% bonus)
  Interest: ₦1,350,000
  
Benefit: ₦210,000 extra interest
ROI on additional ₦500k: 42%!

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Early Liquidation Penalties

Reduced Rate Method

penaltyType: "ReducedRate"
reducedRatePercentage: 50

Example:

Original Terms:
  Principal: ₦3,000,000
  Tenor: 365 days
  Rate: 12%
  Expected Interest: ₦360,000

Liquidated After: 120 days

Penalty:
  New Rate: 12% × 50% = 6%
  Actual Interest: ₦3M × 6% × (120/365) = ₦59,178
  
Lost Interest: ₦360,000 - ₦59,178 = ₦300,822

Penalty Fee Method

penaltyType: "PenaltyFee"
penaltyFeePercentage: 30

Example:

Original Terms:
  Principal: ₦3,000,000
  Rate: 12%
  Expected Interest: ₦360,000

Liquidated After: 120 days

Interest Earned (full rate): ₦3M × 12% × (120/365) = ₦118,356
Penalty: ₦118,356 × 30% = ₦35,507
Net Interest: ₦118,356 - ₦35,507 = ₦82,849

Plus Early Liquidation Fee: ₦1,000

Total Penalty: ₦36,507

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Auto-Renewal Process

autoRenewalConfig:
  allowAutoRenewal: true
  rolloverPrincipalAndInterest: true
  notificationDaysBefore: 7

Timeline:

Day -7 (Before Maturity):
  SMS/Email: "Your FD of ₦1M matures in 7 days. Reply 'STOP' to prevent auto-renewal."

Day 0 (Maturity Date):
  If no action:
    Old FD: ₦1,000,000 principal + ₦120,000 interest = ₦1,120,000
    New FD: ₦1,120,000 (principal + interest rolled over)
    New Rate: Current market rate for same tenor
    Confirmation: "Your FD auto-renewed at 12% for 365 days"
  
  If customer opted out:
    Maturity Value: ₦1,120,000 credited to savings account
    Notification: "FD matured. ₦1,120,000 credited to your account"

Rollover Options:

# Option 1: Principal Only
rolloverPrincipalOnly: true
  Old FD: ₦1M principal + ₦120k interest
  New FD: ₦1M (interest credited to savings)
  Savings: +₦120,000

# Option 2: Principal + Interest (Compound Growth)
rolloverPrincipalAndInterest: true
  Old FD: ₦1M principal + ₦120k interest
  New FD: ₦1,120,000 (compounding effect)
  
Year 1: ₦1,000,000 → ₦1,120,000
Year 2: ₦1,120,000 → ₦1,254,400
Year 3: ₦1,254,400 → ₦1,404,928

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FD as Loan Collateral

loanCollateralConfig:
  allowAsLoanCollateral: true
  collateralLTV: 90
  restrictAccessWhenPledged: true

Process:

1. Customer has FD:
   Amount: ₦5,000,000
   Tenor: 365 days
   Rate: 12%
   Maturity Value: ₦5,600,000

2. Loan Request:
   Requested: ₦4,000,000
   LTV: 90% of ₦5M = ₦4,500,000
   Status: APPROVED ✅

3. FD Pledged:
   FD Status: LIEN_MARKED
   Cannot Liquidate: Yes
   Loan Interest: 18% (lower because of collateral)
   
4. Loan Repayment:
   Option A: Repay loan from other sources → FD lien released
   Option B: Use FD maturity value to repay loan automatically

Benefits:

Without FD Collateral:
  Personal Loan: 24% interest
  Loan Amount: ₦4M
  Annual Interest: ₦960,000

With FD Collateral:
  Collateralized Loan: 18% interest
  Loan Amount: ₦4M
  Annual Interest: ₦720,000
  FD Earning: 12% on ₦5M = ₦600,000
  
  Net Cost: ₦720,000 - ₦600,000 = ₦120,000
  Effective Rate: 3% (₦120k on ₦4M)

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Validation Rules

Amount Validation

Code Removed

Implementation details removed for security.

Contact support for implementation guidance.

Tenor Validation

Code Removed

Implementation details removed for security.

Contact support for implementation guidance.

Early Liquidation Validation

Code Removed

Implementation details removed for security.

Contact support for implementation guidance.

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Troubleshooting

Issue: "Rate lower than expected"

Cause: Shorter tenor or smaller amount.

Solutions:

Current:
  Amount: ₦3,000,000
  Tenor: 90 days
  Rate: 8%
  Interest: ₦59,178

Optimization 1: Increase Tenor
  Tenor: 180 days
  Rate: 10%
  Interest: ₦147,945 (2.5× more)

Optimization 2: Increase Amount to ₦5M
  Amount: ₦5,000,000
  Tenor: 90 days
  Rate: 8% + 1% = 9% (amount bonus)
  Interest: ₦110,959

Optimization 3: Both
  Amount: ₦5,000,000
  Tenor: 180 days
  Rate: 10% + 1% = 11%
  Interest: ₦271,233

Issue: "Need funds before maturity"

Cause: Emergency or unexpected expense.

Solutions:

FD: ₦2,000,000 @ 12% for 365 days
Current Status: 180 days completed

Option 1: Early Liquidation
  Interest earned: ₦2M × 6% × (180/365) = ₦59,178 (reduced rate)
  Receive: ₦2,059,178
  Lost: ₦180,822

Option 2: FD-Backed Loan
  Loan: ₦1,800,000 (90% LTV)
  Interest: 18% for 6 months = ₦162,000
  Keep FD earning: ₦120,000
  Net cost: ₦42,000
  At maturity: Repay loan, net ₦200,000 - ₦42,000 = ₦158,000 ✅

Option 2 better by ₦98,822!

Issue: "Auto-renewal not desired"

Cause: Want to use funds at maturity.

Solutions:

Prevent Auto-Renewal:

Method 1: Opt-Out Before Maturity
  Call/Email bank 7 days before
  Confirm opt-out via SMS/email
  
Method 2: Disable at Creation
  autoRenewalDefault: false
  
Method 3: Close Account
  Request closure 1 day before maturity
  Funds credited to linked account

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Migration from V1

V1 Fixed Deposit Mapping

V1 Field/Table	V2 YAML Path
MinimumDeposit	depositAmountConfig.minimumAmount
TenorDays	tenorConfig.allowedTenors[]
InterestRate	tenorBasedRates[].rate
EarlyWithdrawalPenalty	earlyLiquidationConfig.reducedRatePercentage
AutoRenew	autoRenewalConfig.allowAutoRenewal
CollateralLTV	loanCollateralConfig.collateralLTV

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Last Updated: January 2, 2026
API Version: V2 (BPMCore)
Product Category: Deposit Products
Complexity: ⭐⭐⭐ (Moderate - Tenor & Rate Management)