Fixed Deposits

The Best Fixed Deposit Promotions in Singapore (Jan 2020)

Fixed deposit (sometimes called time deposit) accounts are low-risk investments that earn you interest over a fixed commitment period. You don’t need to do anything to earn this interest, just park your money with a bank. Think of it like mold on a piece of bread. Just leave it out in the open and mold will grow – FREE! – on your bread for you.

Seriously, though, fixed deposits are great if you have a substantial amount of money lying around and you don’t want to risk investing them. Fixed deposits are an extremely low risk way to grow your money.

 

Highest fixed deposit interest rates in Singapore (Jan 2020)

Bank/financial institution Min. deposit amount Tenure Promotional interest rate
CIMB $10,000 12 months 1.80% p.a. (online only, expires 31 Jan)
HSBC  $30,000 6 months 1.75% p.a. (expires 29 Feb) 
Maybank $50,001 24 months 1.75% p.a. (online iSAVvy)
CIMB $10,000 3 or 6 months 1.70% p.a. (online only, expires 31 Jan)
ICBC $20,000 12 months 1.70% p.a. (online only)
Hong Leong Finance $50,000 12 months 1.68% p.a.
Hong Leong Finance $20,000 12 months 1.65% p.a.
ICBC $20,000 6, 9 or 12  months 1.65% p.a.
ICBC $500 12 months 1.60% p.a. (online only)
UOB $20,000 10 months 1.60% p.a. (expires 31 Jan) 
Maybank $20,000 12 months 1.60% p.a. (with $2,000 deposit in current/savings account)
ICBC $500 3, 6 or 12 months 1.55% p.a.
OCBC $20,000 12 months 1.55% p.a.
Standard Chartered $25,000 9 months 1.55% p.a. (expires 31 Jan)

Disclaimer 1: I’ve ignored the crazy-high deposit amounts that banks use to inflate their interest rates because I know how disappointing it is to click on an advert for “2.5% p.a. fixed deposit” only to realise it’s for $1m deposits and up.

Disclaimer 2: Also, some banks have higher interest rates for foreign currencies (RMB, USD usually) but most regular Singaporeans don’t have huge sums of those lying around, so I’ll focus on the SGD ones here.

Disclaimer 3: Many of these promotional rates change monthly. Although some do not have a specified expiry date, the bank can change the rates anytime.

It’s a tad overwhelming, so I’ll split this into tiers based on the deposit amount in the following sections.

 

Best fixed deposit promotions for $10,000 deposit or less

Bank/financial institution Min. deposit amount Tenure Promotional interest rate
CIMB $10,000 12 months 1.80% p.a. (online only, expires 31 Jan)
CIMB $10,000 3 or 6 months 1.70% p.a. (online only, expires 31 Jan)
ICBC $500 12 months 1.60% p.a. (online only)
ICBC $500 3, 6 or 12 months 1.55% p.a.

Usually, you’ll need at least $20,000 lying around in order to benefit from decent promotional interest rates.

But Chinese bank ICBC has now introduced super-low fixed deposits with really good rates for as little as $500. The maximum of 1.60% p.a. is decent, especially for such a small deposit amount.

If you have more cash to grow — at least $10,000 — then the highest rate is currently 1.80% p.a., as offered by CIMB.

If you can’t afford a 1-year tenure, don’t be discouraged: both ICBC and CIMB have attractive rates for shorter lock-in periods too. In fact, if you have $10,000 to keep away for at least 3 months, you can earn as much as 1.70% p.a.

That is very competitive (and not just for this tier).

 

Best fixed deposit promotions for $20,000 to $30,000 deposit

Bank/financial institution Min. deposit amount Tenure Promotional interest rate
CIMB $10,000 12 months 1.80% p.a. (online only, expires 31 Jan)
HSBC  $30,000 6 months 1.75% p.a. (expires 29 Feb) 
CIMB $10,000 3 or 6 months 1.70% p.a. (online only, expires 31 Jan)
ICBC $20,000 12 months 1.70% p.a. (online only)
ICBC $20,000 6, 9 or 12  months 1.65% p.a.
Hong Leong Finance $20,000 12 months 1.65% p.a.
ICBC $500 12 months 1.60% p.a. (online only)
UOB $20,000 10 months 1.60% p.a. (expires 31 Jan) 
Maybank $20,000 12 months 1.60% p.a. (with $2,000 deposit in current/savings account)
ICBC $500 3, 6 or 12 months 1.55% p.a.
OCBC $20,000 12 months 1.55% p.a.
Standard Chartered $25,000 9 months 1.55% p.a. (expires 31 Jan)

If you’ve got $20,000 or more to lock up, you have a lot more options as this is where most of the competition is.

2019 was quite a good year for fixed deposits – many banks (especially the Malaysian and Chinese ones) — offered very attractive rates of 2% p.a. and up for this tier.

Sadly, the rates started going down towards the end of the 2019, and this month, the highest interest rate is only 1.80% p.a. For now, CIMB is in the lead, offering 1.80% p.a. for 12-month deposits of at least $10,000.

Coming in second and making a new entrance to this list is HSBC: their festive promotion (2 Jan to 29 Feb 2020) offers a neat 1.75% p.a. for a relatively short tenure of just 6 months. The catch? You need minimum $30,000 to lock up.

The next best rate is 1.70% p.a., and you can choose from CIMB or ICBC.

If you’re not keen on foreign banks, the more competitive local banks are OCBC and UOB. There’s no need to consider DBS/POSB as they don’t do fixed deposit promotions, and the board rates are really low.

Of the 2 mentioned above, UOB offers a higher interest of 1.60% p.a. for minimum $20,000 deposit and 10 months tenure. OCBC is only offering 1.55% p.a. and requires a longer lock-in period of 12 months.

What about the popular Maybank fixed deposit promotions?

Maybank topped this tier for most of 2019, but this year, they’ve dropped their rates dramatically. Guess they got all the cash they needed.

Currently, their best rate is a mediocre 1.60% p.a. for the current/savings account (CASA) + fixed deposit promotion. I wouldn’t waste my time with this: not only do you need to have at least $20,000, but you also need $2,000 in a CASA with Maybank.

 

Best fixed deposit promotions for $50,000 deposit

 

Bank/financial institution Min. deposit amount Tenure Promotional interest rate
CIMB $10,000 12 months 1.80% p.a. (online only, expires 31 Jan)
HSBC  $30,000 6 months 1.75% p.a. (expires 29 Feb) 
Maybank $50,001 24 months 1.75% p.a. (online iSAVvy)
CIMB $10,000 3 or 6 months 1.70% p.a. (online only, expires 31 Jan)
ICBC $20,000 12 months 1.70% p.a. (online only)

As you can see, I’ve only listed the promotions offering 1.70% p.a. and up. That’s because $50,000 is a lot of money, so I wouldn’t settle for anything less.

Usually, those with at least $50,000 to mess around with can benefit from the best rates in the market. This Jan 2020, however, you only need $10,000 to “unlock” the highest fixed deposit promotion rate of 1.80% p.a.

If you have this much savings but are uncomfortable locking up for too long, you can consider HSBC’s festive promotion and earn 1.75% p.a. after 6 months.

Of course, banks are notoriously fickle about their interest rates, and this could easily change next month. For the latest promotional rates, remember to bookmark this page and our MoneySmart fixed deposit comparison page before you commit.

Plus, here’s a quick and dirty summary of what you need to know about fixed deposits.

 

Fixed deposit vs savings account — what’s the difference?

Once an attractive alternative to that pathetic 0.05% p.a. interest on savings accounts, fixed deposits — like so many ageing Channel 8 starlets — are fading from collective memory. Today, every bank in Singapore is competing for your dollar with high interest savings accounts, so it’s actually possible to earn close to 2% p.a. on your savings. What a time to be alive!

Here are the differences between fixed deposits and savings accounts at a glance:

Fixed deposit Savings account
Tenure As low as 3 months, but go for at least 12 months for better rates None
Interest rate The longer the tenure, the better the interest rate Usually the same regardless of tenure
Amount to deposit Fixed amount, usually at least $10,000 Smaller initial deposit and minimum monthly balance ($500 to $3,000)
Currency SGD by default, but some banks offer higher interest rates for foreign currency SGD by default. There are a few multi-currency accounts, but no difference in interest rate
Can you withdraw? Contrary to popular belief, yes, but you lose the interest Yes, no impact on interest, but don’t fall below the minimum balance
Interest payments Quarterly or annually Monthly
Risk level Virtually risk-free, insured up to $75,000 by Singapore Deposit Insurance Corporation (SDIC)

 

Fixed deposit vs Singapore Savings Bonds — which is better?

In an earlier article, we compared the Singapore Savings Bonds to fixed deposits. There are a few key distinctions between these virtually risk-free investment vehicles.

First, the entry point for Singapore Savings Bonds is much lower than most FDs. The minimum investment is just $500, which is way lower than the $10,000 or $20,000 you’d need to secure a decent fixed deposit interest rate. On the flip side, there’s a cap of $200,000 you can put into Singapore Savings Bonds. There’s no cap for fixed deposits.

Second, fixed deposits are shorter term investments, with the lock-in period usually hovering around 12 months. After the period is over, you should shop around again for another place to park your money.

With SSBs, however, the interest rate climbs every year, so the longer you keep the money in there (up to a maximum of 10 years) the more you get. At the same time, SSBs have higher liquidity than fixed deposits. You will not be penalised if you withdraw your money at any point. You do have to pay a $2 transaction fee each time you buy or redeem a bond, though.

As for interest rates — which is obviously the most important point! — there’s been a bit of an “interest rate war” going on in the past year or so.

Right now, fixed deposit interest rates are higher. The January issue of SSBs offer 1.52% p.a. interest for the first 3 years, which you can easily beat with a well-chosen fixed deposit promotion that gives you over to 1.70% p.a.

Would you consider parking your money in a fixed deposit account? Why or why not?

 

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Comments (2)

  1. OCBC 360 is way better than fixed deposit.

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