Beyond the Numbers

The rate is only part of the choice. These also matter.

• Issued by

  Treasury Bond: The Government of Bangladesh

  Bank Deposit: Your bank, on its own terms

• Interest paid

  Treasury Bond: Every 6 months

  Bank Deposit: As your bank sets it. Check how and when.

• Minimum

  Treasury Bond: ৳1,00,000, in multiples of ৳1,00,000

  Bank Deposit: Depends on the bank

• Taking money out early

  Treasury Bond: Depends on the market. The price can be lower than you paid.

  Bank Deposit: Depends on the bank. Check the early withdrawal rules.

How the Comparison Works

1. 1

   Interest Before Tax

   Amount × rate. ৳10,00,000 at 9% pays ৳90,000 a year. At 8% it pays ৳80,000.

2. 2

   Take Off the Tax

   Both are taxed at source. At 10%, ৳90,000 becomes ৳81,000 and ৳80,000 becomes ৳72,000 a year.

3. 3

   Add Up the Years

   Interest after tax × years. Over 5 years that is ৳4,05,000 for the bond and ৳3,60,000 for the deposit.

Example: ৳10,00,000 for 5 years. A 9% bond pays ৳4,05,000 after 10% tax. An 8% deposit with 10% tax pays ৳3,60,000. The difference is ৳45,000.

Bond vs Deposit Questions

Is a Treasury Bond better than a bank fixed deposit?

Neither is better for everyone. The right choice depends on the rates on offer, how long you can leave the money, whether you may need it early, and your tax position. This calculator compares only the interest you keep after tax.

How is tax taken from bond interest?

Bangladesh Bank deducts 10% AIT from every bond interest payment, so you receive the amount after tax.

How is tax taken from deposit interest?

Banks deduct tax at source from deposit interest. The rate depends on your tax status, so check with your bank and change the figure in the calculator.

Where do I find the bond interest rate?

In the Bangladesh Bank auction result. The Treasury Bond Center shows the latest results and the next auction.

Why does the calculator not use compound interest?

Bond interest is paid out every 6 months and bank terms differ. To keep the comparison clear, interest is treated as paid out and not reinvested.

Does the result include fees and charges?

No. Fees, charges and any other duties are not included. Your bank and Midway can tell you what applies.

What if I sell the bond or break the deposit early?

The numbers here assume you hold both to the end. A bond sold before maturity sells at the market price, which can be lower than you paid. A deposit broken early follows your bank’s rules, which can reduce the interest.

Quick Glossary

Treasury Bond

A loan to the Government of Bangladesh that pays interest every 6 months and returns your money at maturity.

Fixed Deposit

Money placed with a bank for a set period at an agreed interest rate.

AIT

Advance Income Tax, deducted at source before you receive the interest.

Maturity

The date a bond or deposit ends and your original amount is returned.

After-Tax Return

The interest you keep as a percentage of your amount, once tax is taken off.