How to choose a deposit: what to check in the agreement so you do not lose interest

Choose a deposit by the net income you will actually receive and by what happens if you need the money early. The advertised rate tells you little about either. Five clauses of the agreement matter most: how interest is paid (capitalised or once at the end), whether you can withdraw early and at what rate interest is then recalculated, how automatic renewal works, what the “up to” rate depends on, and whether the bank is a member of the deposit guarantee system. Below is how to read each clause, worked examples and a checklist for the agreement.

Andrii Kolisnyk November 13, 2026 14 min read

What the rate in the agreement really means

In the agreement and in ads, a bank quotes the nominal annual rate before tax. It shows how much interest is accrued per year on the initial amount and says nothing about how often interest is paid, whether it is added to the deposit or how much of it goes to tax. That is why two offers with the same rate can bring different income, and an offer with a lower rate sometimes beats a higher one.

What the law guarantees. Under Article 1061 of the Civil Code, a bank cannot unilaterally cut the rate on a term deposit. A clause giving the bank that right is void. The rate on a demand deposit (including a savings account) can be changed by the bank unless the agreement says otherwise; if it is cut, the new rate applies to money already deposited one month after notice. Interest accrues from the day after the money arrives until the day before it is returned.

A market benchmark: the average rate on 12-month hryvnia deposits by the latest UIRD index is 14.29% a year, and on dollar deposits 1.17%. An offer well above the average is a reason to read the terms more carefully: a high rate often compensates for the restrictions described below.

Capitalisation and interest payment: where the money hides

Banks pay interest in three ways:

At the end of the term. Interest accrues monthly, but you receive it together with the deposit on the last day.
Monthly to your card. Interest goes to your current account and you can spend it, but nothing more accrues on it.
With capitalisation. Every month (less often every quarter) interest is added to the deposit, and the next month interest accrues on a larger amount.

The difference shows in the effective rate, the actual yield for a year including capitalisation. For a 15% annual rate it looks like this:

Interest payment	Effective rate before tax, %	Net income on UAH 100,000 per year, UAH
At the end of the term or monthly to a card	15.00	11,550
Quarterly capitalisation	15.87	12,060
Monthly capitalisation	16.08	12,181

Tax is withheld from each accrual, so it is the net amount that gets capitalised. The figures are calculated the same way as in our deposit calculator.

Monthly payout to a card makes sense when interest is part of your living income. If you are saving towards a goal, choose capitalisation: at the same rate it always pays more.

Taxes and real return

The bank withholds 18% personal income tax and 5% military levy from deposit interest, 23% in total. The bank pays the tax itself at accrual, so you do not need to file a tax return because of a deposit. The rate is the same for hryvnia and foreign currency deposits, and there is no tax-free amount for deposits.

After tax, the average rate of 14.29% becomes 11.00%. Inflation by the latest State Statistics Service data is 11% year on year. The net rate is almost equal to inflation: a typical one-year deposit without capitalisation currently preserves purchasing power but barely grows it. That is why a few tenths of a percentage point and the way interest is paid make a noticeable difference.

Foreign currency deposits protect against devaluation, but the income is symbolic: at 1.17% after tax, USD 5,000 earns about USD 45 a year. How to decide what share of savings to keep in foreign currency is covered in our article on a hryvnia or dollar deposit.

Early withdrawal: the most important clause

Since 2015, a depositor can take a term deposit before maturity only if the agreement provides for it (amendments to Articles 1060 and 1065 of the Civil Code). If the agreement has no such right, the bank can lawfully refuse, even if you need the money for medical treatment. So before signing, find the early withdrawal section and check three things: whether you can withdraw at all, at what rate interest is then recalculated, and whether interest already paid will be taken back from the deposit.

Deposit type	What happens if you withdraw early	Who it suits
Irrevocable	No early withdrawal. Usually the highest rate	Money you will certainly not need before maturity
With the right to terminate early	The deposit is returned and interest is recalculated at a reduced rate (often the demand rate). The difference already paid is deducted from the deposit	Money with a small chance of being needed early
With partial withdrawal, or a savings account	You can withdraw part without losing interest on the rest, sometimes with a minimum balance	An emergency fund, money for the coming months

If there is a real chance you will need the money early, compare offers by the result in the worst case: the headline rate matters little here. Money for unexpected expenses is better kept separately, see our article on an emergency fund.

Top-ups and partial withdrawals

The NBU regulation on agreement requirements obliges the bank to state explicitly whether the deposit can be topped up and partly withdrawn during the term. If you plan to add money monthly, check:

whether top-ups earn the same rate as the initial amount or the rate on the top-up date;
until when you can top up (many agreements close top-ups a few weeks or months before maturity);
whether there is a minimum top-up and a maximum deposit amount;
whether a minimum balance applies to partial withdrawals and what happens if you go below it.

Example: UAH 100,000 at 15% with monthly capitalisation and a UAH 5,000 monthly top-up grows to UAH 175,462 in a year, of which UAH 15,462 is net income. You can try your own combination of amount, rate and top-ups in the calculator.

Automatic renewal: on what terms the deposit is extended

Many agreements renew the deposit automatically for the same term if you do not withdraw the money on the last day. The NBU requires the agreement to state explicitly whether the bank may extend the term. The key question is at what rate: usually the rate the bank offers new deposits on the renewal date, and it may be lower.

What to check: whether the bank sends a notice before maturity, how to opt out of renewal (a button in the app, an application), how many times the deposit can be renewed and whether the early withdrawal right survives renewal. Put the maturity date in your calendar with a reminder a week ahead.

“Up to 18%”: what the maximum rate depends on

The words “up to” in an ad mean that not everyone gets the maximum rate. Most often it depends on:

new money: a higher rate for funds that were not in the bank on a certain date;
amount: tiered rates, with the maximum only above a certain amount;
how you open it: the rate in the app can be higher than in a branch;
term and payout: the maximum is often only for an irrevocable deposit with interest at the end;
other products: a bonus for a salary project, a credit card or a service package;
promotional period: a higher rate only for the first months.

If the bonus requires another product, add its cost to the calculation: a card or package fee can eat the whole rate advantage.

Which term to choose and how to build a deposit ladder

A longer term usually means a higher rate and locks it in, but reduces flexibility. Short deposits of 1-3 months suit money you will need soon and a pause while you decide what to do with a sum. Predicting rate moves is futile, so it is wiser to split the money across terms.

A deposit ladder combines the higher rate of long deposits with regular access to money. For example, UAH 120,000 is split into three parts of UAH 40,000 placed for 4, 8 and 12 months. When the first deposit matures, the money moves to 12 months, and so on with each next one. After a year you have three one-year deposits, and every 4 months one of them matures, so part of the money becomes available regularly without early termination.

Part of the money can go into government bonds: their income is not taxed, and bonds with different maturities are just as easy to build into a ladder. A comparison of the two is in our article on a deposit or government bonds.

Deposit guarantee: what to check before signing

During martial law, the Deposit Guarantee Fund compensates deposits in member banks in full. Three months after it ends, the guarantee returns to UAH 600,000 per person per bank, including interest. What to check:

The bank is a member of the Fund. The list of members is on the FGVFO website.
You received and signed the Information Sheet on the deposit guarantee system. The bank must provide it before the agreement if you do not yet have an account there.
The deposit is not on individual terms. The Fund does not compensate deposits with interest or other benefits on terms much better than the market. Also not compensated: deposits in bank metals, savings and deposit certificates (since 5 August 2021) and deposits pledged as loan collateral.
The amount in one bank. For large sums on a term that may run past martial law, split deposits between several banks so that each holds no more than the guaranteed amount.

How the Fund calculates and pays compensation and what happens to cards and loans when a bank fails is covered in our article on the deposit guarantee fund.

Where to find the terms and what the bank must state

When you open a deposit in an app, there is no separate paper agreement: the terms are in the public agreement (offer), tariffs and product description, and you accept them by pressing a button. Save a PDF or screenshots of the terms on the opening date: the bank may change tariffs for new deposits, and you will need the version you agreed to.

The NBU Regulation on additional requirements for financial services agreements (Resolution No. 7 of 22.01.2021) obliges the bank to state in the deposit description:

the return date (except for demand deposits);
whether the term can be extended after it ends;
whether money can be withdrawn partly or fully and the deposit topped up during the term;
the interest rate and how often interest is paid (monthly, yearly, at the end of the term, etc.);
how the deposit is returned;
whether tariffs and fees related to the deposit may change.

It also sets formatting rules: a font of at least 11 points, and amounts of costs, increased interest, fines and penalties in bold. If the terms are written so that you cannot find the early termination rate or renewal rules, that alone is a signal to choose another bank.

Deposit agreement checklist

Clause	What it should say	Red flag
Rate	A fixed annual rate for the whole term, the same in the agreement and in the app	An “up to” rate without the conditions; a bank right to change the rate on a term deposit
Interest payment	Capitalisation for saving, or payout to a card if interest is living income	Interest only at the end of a long term when early termination is likely
Early withdrawal	A stated right and recalculation rate	No right while you may need the money; interest already paid deducted from principal
Renewal	A notice before maturity and an easy way to opt out	Renewal “at the bank's rate on the renewal date” without notice
Top-ups and withdrawals	The rate on top-ups, deadlines and limits	Top-ups at a different, lower rate; a minimum balance you did not know about
Fees and bundled products	No fees, tariffs fixed	A rate bonus for a paid card or service package
Guarantee	The bank is an FGVFO member, Information Sheet received	“Individual terms”, certificates, metal deposits, a rate far above the market

Comparing three offers

Hypothetical offers for UAH 100,000 for a year (rates invented for the example to show how terms work):

A: 15.5%, interest at the end of the term, irrevocable;
B: 15%, monthly capitalisation, on early termination interest recalculated at 1%;
C: 14%, interest monthly to a card, money can be withdrawn at any time without losing accrued interest.

Scenario	A: 15.5%	B: 15% capitalised	C: 14% free withdrawal
Money stays for the whole year	UAH 11,935	UAH 12,181	UAH 10,780
Money needed after 6 months	Cannot withdraw	UAH 386	UAH 5,390

The highest rate (A) does not give the highest income even in the best case. Offer B wins if the money will certainly stay for a year, and C if there is a real chance you will need it earlier. For a larger sum it makes sense to combine: the emergency fund in an option like C, the rest in B.

Common mistakes

Comparing rates only. The way interest is paid, early termination and renewal change income more than half a percentage point of rate.
Putting an emergency fund into an irrevocable deposit. When you need the money, the bank is not obliged to return it before maturity.
Forgetting about tax. Only 77% of the nominal rate is left, and it is the net yield that should be compared with inflation and bonds.
Not watching the maturity date. Automatic renewal at a lower rate quietly cuts income.
Keeping a large sum in one bank. After martial law the guarantee will be capped at UAH 600,000 per depositor per bank.
Accepting “individual terms” or a rate far above the market. The Fund may not compensate such deposits.

In short

Compare net income for the whole term: rate, interest payment and the 23% tax together.
Monthly capitalisation pays more at the same rate; 15% capitalised beats 15.5% paid at the end.
Early withdrawal is possible only if the agreement provides for it; find the recalculation rate before signing.
Check the renewal terms and set a reminder for the maturity date.
The bank must be an FGVFO member; for large sums after martial law, split deposits between banks.
Combine terms in a ladder and keep part of the money in government bonds.

Figures in this article

Personal income tax18%
from January 1, 2016
Military levy on salaries and interest5%
from December 1, 2024
Inflation in October 2026, year on year11%
October 2026
Guaranteed deposit amount after martial lawUAH 600,000
3 months after martial law ends
Average rate on 12-month hryvnia deposits14.29%
UIRD index, 30 Oct 2026
Average rate on 12-month US dollar deposits1.17%
UIRD index, 30 Oct 2026

Checked against official sources on October 28, 2026. If a figure changes, we update the article and the «Updated» date changes automatically.

Sources

This article is for information only and is not financial or investment advice. Check current terms with your bank or financial institution before making decisions.

Spotted a mistake or an outdated figure? Let us know and we will check it against the primary source and fix it.