Ecuadorian experts recommend shorter fixed-term deposits

In Ecuador, experts are advising savers to consider shorter-term fixed-term deposits, such as three-month policies, rather than one-year commitments. While interest rates for these products have declined, they remain a viable option for growing capital through banks or credit unions.

Economic expert Alberto Acosta Burneo noted that the Central Bank of Ecuador's reference passive rate reached 8.45% in 2024, but current rates have dropped significantly, ranging from approximately 4% to 4.40%. David Pazmiño, a professor at the Universidad Internacional del Ecuador, attributes this decline to excess liquidity in the banking system, driven in part by increased cocoa prices. This surplus of liquidity means banks have more funds than they can lend, reducing their need to attract new deposits through high interest rates.

Financial advisors recommend that individuals break down their monthly budgets—accounting for fixed costs like rent, food, and education—and aim to save between 10% and 20% of their income to build a consistent savings culture.