How Do Northquest Finance Savings Plans Work, and How Is Interest Calculated?

Northquest Finance offers a variety of savings plans designed to help users grow their funds while earning competitive interest rates. This article explains how these plans work, how interest is calculated, and the options available to users.

Overview of Savings Plans

Northquest Finance provides several savings and investment options, each tailored to different financial goals and preferences. These include:

Qlock (Fixed-term): Offers 24% interest per annum. Funds are locked for a chosen period until maturity and cannot be accessed early. The maturity date cannot be changed, and funds cannot be topped up. Users can choose to receive interest immediately or at maturity.
Qflex (Flexible): Provides 15% interest and allows users to top up their investment at any time.
Autosave (Custom plan): Offers 20% interest. Users can set a specific amount and configure automatic funding at their chosen time and frequency. These plans debit your linked debit/credit card or Northquest wallet on a schedule you select.
Savings Challenge: Features predefined amounts and durations for saving, with an accountability streak to encourage consistent contributions.
Halal Save: Designed for users who prefer savings without earning interest.

How Interest Is Calculated

Interest on savings plans is calculated based on the type of plan and the duration of the investment. Here’s how it works:

Projected Interest Calculation: Open the Northquest Finance app, select a savings plan and specify the plan duration. The app automatically calculates and displays the projected interest based on your selections.

Recurring Deposit Plans: For plans like Autosave, each deposit accrues interest only for the time it remains in the plan until maturity. Interest is computed per deposit based on the number of days it is invested. Earlier deposits earn interest for a longer period, while later deposits earn for fewer days. Interest is not withdrawn periodically; it is paid out at maturity along with the total contributions.

Example of Interest Calculation

For a recurring deposit plan, such as saving weekly:

Weekly savings: ₦5,000 for 52 weeks → Total saved: ₦260,000
Interest rate: 20% per annum, calculated on each weekly deposit for its actual days in the plan
Total interest over the term: ₦26,569.86
Total payout at maturity: ₦286,569.86

This example illustrates how interest is calculated for recurring deposits, but the same principles apply to other plans with varying terms and rates.

Plan Maturity and Fund Withdrawal

Automatic Fund Transfer: When a savings plan matures, the funds, along with any accrued interest, are automatically transferred to your Northquest wallet. You do not need to initiate this transfer manually.
Accessing Funds: Once the funds appear in your wallet, you can withdraw them to your linked bank account. For Qlock plans, funds are locked until the maturity date, after which they are automatically moved to your wallet.

Modifications and Tenure Selection

Fixed Nature of Plans: Savings plans, including Qlock, are fixed-term products. This means you cannot extend the duration of a plan after it matures or change its maturity date once it is set.
Tenure Selection: For plans like Qlock, you can select the tenure at the time of creation. This allows you to align the plan with your financial goals.

Continuing Savings After Maturity

Starting a New Plan: Once a plan matures, you can start a new savings plan to continue building your savings. For Autosave plans, ensure your funding source remains active to maintain automatic debits. For Qlock plans, you will need to create a new plan after the funds are transferred to your wallet.

How do Northquest Finance savings plans work, and how is interest calculated?