Best Low-Risk, High Return Fixed Deposit Investments You Didn’t Know
Best Investment Opportunities In Nigeria – Where To Invest Your Money With High Return, Low Risk – List Of Untapped Fixed Income Financial Opportunities This Year.
When I drew the business model and jotted-down content ideas of this blog, I never considered alternative fixed income investment opportunities as a category to be added too soon, but as a flexible investment entrepreneur who listens to the subscribers’ request, I felt it isn’t a bad idea to talk about the investment options you can explore (amidst rising cost of living) beyond the stock market but with key focus on risk tolerance and capital protection. Besides, it is not everyone that can swallow the risk that comes with stock investing.
My focus on risk here means that I would be screening investment options strictly on legal, risk level and return potential; I can’t undertake a long or short term investment that wouldn’t let me sleep well at night, if it’s going to make me get worried, then I won’t give it a try, that’s my mantra.
I had some idle cash that generated from financial services rendered to a corporate client and decided to scout for the best alternative investment opportunities in Nigeria offering high-return above and twice the inflation rate of 11 – 13% in 360 days with the lowest risk of capital loss. This time, I wasn’t going save the cash and allow my bank use it for business nor go for the fixed deposit investment return option of 8 – 9% p.a offered by our local banks, I wanted something better than bank and money market rates. Besides, my benchmark rate was set at 15% per annum (the average inflation rate figure as of this writing) which makes it even more difficult to find a financial investment opportunity offering such a higher return at low risk.
From 2014-2017, 1-year treasury bills offered up to 22% but as economic risk reduces on the back of a bullish oil market and stable exchange rate, it went down to 15%. So, if you had been a firm believer of TBs as the best-fixed income investment, you probably should re-think your portfolio allocation.
The only investment that could possibly beat the inflation rate of 11-13% is the one invested in professionally managed equity mutual fund with a track record of impressive positive performance. Some of these funds posted up to 52% return on investment in 2017; if you had invested N1m, you would have ended the year with a portfolio value of N1.52m.
You know what? I still wouldn’t give it a try because the stock market isn’t devoid of risk, this is not cash I would love to expose to share price fluctuation in short-term. After all, a lot of equity mutual funds also posted a negative return.
Mutual funds, like I said, are good long-term investment options; managers of these funds basically pick stocks that will deliver long-term gain from share price appreciation and dividend income growth.
On a lookout for other lower risk short term opportunities, I discovered the three emerging high yield and secured investment providers no one is actually talking about, while these investments are still new in Nigeria, some smart businesses entrepreneurs like us are already cashout from the model. It is a lending business opportunity.
You are aware of loan lending platforms in Nigeria like Pay later, C24, Kia-Kia, etc. These guys are taking advantage of the personal finance loan business gap banks couldn’t fill to generate billions of naira.
Let’s take a look at a personal loan lending platform and how much they charge as interest when you request for loan:
This snapshot above is the interest repayment of N115, 028.69 payable monthly on N620,000 loan request with 7 months tenor. You can see the total amount payable at maturity, N805, 200.83 which is equivalent to 29.8% interest return to the lender.
Isn’t this outrageous? Now, imagine the number of users who request for a loan every day!
My dear, this is what banks make on you when you keep your cash in a savings deposit account for 7 months and in return pay you 1.75% interest (3% x 7/12 months).
These lenders, because they may not have enough capital to finance growing loan request, resort to borrowing more cash from individuals or corporate organisations with a promised return of up to 20 – 39%. The financial opportunities here is to plug in as a registered lender who gives to this registered and CBN-regulated credit company and earn a higher return than the rate on fixed deposit and treasury bills investments.
Best Investment Opportunities In Nigeria With Low Risk and High Return
The potential of fixed deposit investment opportunities is no longer held by banks again but personal finance and SME loan lenders who are able to charge higher interest on a quick personal loan to salary earners or business owners to finance short-term needs. The companies have perfected borrowers’ credit and background checks to the extent that they only approve loan whose default ratio is less than 0.5%. To encourage quick payback, they initiated a model that compensates borrowers who pay on/before maturity with higher loan disbursement, such that if they meet up to their current obligations, they can request for more loan.
Here are the 3 credit providers you can invest in:
This is a licensed microfinance bank that offers consumer finance banking services. They started as a credit company before they got approval from the CBN to carry out microfinance operation.
As a lender on their platform, you can enjoy a higher return of up to 22% per annum depending on your capital. Here is a table showing your deposit sizes, duration and percentage return.
This micro-credit company requires an online registration of potential lenders and verification of identities using BVN and government-issued ID card before approval and if you are successful, you would be required to deposit into their corporate account, once payment is confirmed, you will receive an investment certificate showing the amount invested, maturity date, tenor, rate, WHT and full value.
Here is a typical return on N400,000 invested I invested in this company for 360 days:
Please note the following:
- The interest on this investment is subject to 10% Withholding Tax (WHT).
- The investment and the accrued interest will be rolled over at the prevailing money market rate if we do not receive instruction from you on or before the maturity.
- The terms and conditions as contained in the Fixed Deposit Account Opening Form are hereby incorporated by reference with the same force and effect as though fully set forth herein, which terms and conditions may be changed by the company at any time without prior notice.
- The terms and conditions contained in the Fixed Deposit Account Opening Form can be accessed via Terms and conditions
- Where you request to withdraw funds prior to the maturity date, the may, in its absolute discretion, approve/reject a request for early withdrawal. Where such early withdrawal is approved by the company, a penalty charge of 50% of the accrued interest will be applied.
Option 2 (Exclusive)
This lender offers a better and higher return of 26-39% per annum compared to one mentioned above. The attractive feature of this investment option is that your interest rate is not dependent on deposit size of N20,000, besides, all loan disbursed are insured which means that if borrowers defaults, there is a chance of recouping your cash back.
This is how this option works:
- Browse loans to creditworthy borrows who have passed all18 different credit check and loan criteria.
- Lend to borrowers at a higher rate.
- Earn monthly return; direct deposit to your bank account.
- Pay 1.5% of your return as operation fee.
Options 3 (Exclusive)
This provider has disbursed over N20 billion to 400,000 salary earners in Nigeria.
This is a sample advert from this credit company on BusinessDay Newspaper, one of the most respected business and investment dailies in Nigeria.
As I said, these three platforms are registere and regulated by the Central Bank of Nigeria, so you are assured of capital protection and returns on maturity.
When I discovered these platforms, I don’t even bother about investing in my bank’s fixed deposit offer of 6-9% per annum when I can earn a solid low-risk return of 20-39% per annum.
Would you still invest in your bank’s fixed deposit? I guess it’s a capital NO, then, Click here to Download and Gain Instant Access to the Contact of these Untapped High-Yield Fixed Deposit Providers in Nigeria and Earn Up to 20-39% Per Annum
Contact: You can contact me for inquiries and questions on 08084219399. These providers are CBN regulated and NDIC insured.