AmendmentFintech

NBE/INT/13/2026 INTEREST RATES (AS AMENDED)

National Bank of EthiopiaINT/13/2026

Summary

This directive amends previous interest rate directives, allowing banks to freely determine their deposit and lending interest rates, subject to reporting requirements to the National Bank of Ethiopia.

Who's affected

Banks licensed by the National Bank of Ethiopia.

Action required

Banks must set and report their deposit and lending interest rates in writing according to the specified criteria and timelines.

Key points

5
  • Interest rates for deposits and loans are now freely determined by banks.
  • Banks must establish written criteria for setting interest rates.
  • All interest rate directives previously issued by the National Bank of Ethiopia are repealed.
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    • Banks must report their determined rates and criteria to the NBE within five working days.
    • Monthly weighted average deposit and lending rates must be submitted to the NBE.

Requirements

9
  • Demand, saving, and time deposit interest rates shall be freely determined by each bank.
  • Lending rates on loans and advances shall be freely determined by each bank.
  • Inter-bank lending rates shall be determined by negotiation between trading banks.
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    • The Board of Directors of each bank shall set deposit and lending rates in writing.
    • Deposit and lending rates shall be non-discriminatory and based on clear written criteria.
    • Banks shall submit set rates and criteria to the National Bank of Ethiopia within five working days.
    • Banks shall calculate and submit monthly actual weighted average deposit and lending rates to the National Bank of Ethiopia within seven working days after the end of each calendar month.
    • Lending rates on loans and standing facilities granted by the National Bank of Ethiopia shall be determined by the National Bank of Ethiopia.
    • Banks are not allowed to engage in prohibited activities that compromise the integrity of the interbank money market.

Rights and permissions

3
  • Banks have the right to freely determine demand, saving, and time deposit interest rates.
  • Banks have the right to freely determine lending rates on loans and advances.
  • Trading banks have the right to determine inter-bank lending rates through negotiation.

Restrictions

3
  • Deposit interest rates set by banks shall not be applicable to time deposits held prior to the effective date of these directives, unless the loan contract provides otherwise.
  • Lending interest rates shall not be applicable to loans and advances granted prior to the effective date of these directives, unless the loan contract provides to the contrary.
  • Banks are prohibited from engaging in activities that compromise the integrity or efficiency of the interbank money market.

Objectives

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  • To regulate and determine the supply and availability of money and credit.
  • To maintain price and financial stability.
  • To foster the balanced growth of the Ethiopian economy.
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    • To enable interest rate determination by market forces.

Organizations

4
  • National Bank of Ethiopia
  • Banks licensed by the National Bank of Ethiopia
  • Commercial Banks
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    • Other Financial Institutions

Legal references

3
  • National Bank of Ethiopia Proclamation No. 1359/2025 article 6(5)
  • National Bank of Ethiopia Proclamation No. 1359/2025 article 54(5)
  • Interbank money market code of conduct
Original sourcehttps://nbe.gov.et/files/nbe-int-13-2026/
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