Fixed Deposits

The Best Fixed Deposit Promotions in Singapore (Mar 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 (Mar 2020)

Bank/financial institution Min. deposit amount Tenure Promotional interest rates
Maybank $50,001 24 months 1.75% p.a. (online iSAVvy)
ICBC $20,000 12 months 1.70% p.a. 
ICBC $20,000 3, 6 or 9 months 1.65% p.a.
ICBC $500 12 months 1.60% p.a. 
Maybank $20,000 12 months 1.60% p.a. (with $2,000 deposit in current/savings account)
ICBC $500 3, 6 or 9 months 1.55% p.a.
Hong Leong Finance $20,000 10 months 1.52% p.a.
CIMB $10,000 3, 6 or 12 months 1.50% p.a. (online only, expires 31 Mar)
UOB $20,000 10 months 1.50% p.a. (expires 31 Mar) 
OCBC $20,000 12 months 1.48% p.a.
HSBC  $30,000 6 months 1.45% p.a. (expires 31 Mar) 
Standard Chartered $25,000 9 months 1.45% p.a. (expires 29 Feb)

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 a super attractive advert, 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, and 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 rates
ICBC $500 12 months 1.60% p.a.
ICBC $500 3, 6 or 9 months 1.55% p.a.
CIMB $10,000 3, 6 or 12 months 1.50% p.a. (online only, expires 31 Mar)

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 very decent, especially for such a small deposit amount. The 12-month tenure is also average.

CIMB also has a relatively lower minimum deposit criterion, but assuming you have $10,000 lying around, you’re better off with ICBC. If you park your cash with CIMB, you’ll only get 1.50% p.a., which is not competitive at all, and right at the bottom of this month’s promotion rankings.

This is pretty surprising, considering CIMB spent most of 2019 wrestling with Maybank for the top spot. They used to offer rates as high as 2% p.a., and just last month, their best rate was 1.75% p.a.!

 

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

Bank/financial institution Min. deposit amount Tenure Promotional interest rates
ICBC $20,000 12 months 1.70% p.a. 
ICBC $20,000 3, 6 or 9 months 1.65% p.a.
ICBC $500 12 months 1.60% p.a. 
Maybank $20,000 12 months 1.60% p.a. (with $2,000 deposit in current/savings account)
ICBC $500 3, 6 or 9 months 1.55% p.a.
Hong Leong Finance $20,000 10 months 1.52% p.a.
CIMB $10,000 3, 6 or 12 months 1.50% p.a. (online only, expires 31 Mar)
UOB $20,000 10 months 1.50% p.a. (expires 31 Mar) 
OCBC $20,000 12 months 1.48% p.a.
HSBC  $30,000 6 months 1.45% p.a. (expires 31 Mar) 
Standard Chartered $25,000 9 months 1.45% p.a. (expires 31 Mar)

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 1.70% p.a.

For now, ICBC is in the lead with 3 promotions, offering 1.60% p.a. to 1.70% p.a. If you have $20,000 to deposit for 1 year, then you can “unlock” the highest yield of 1.70% p.a. If you have the cash but want a shorter tenure, you can settle for 3, 6 or 9 months for 1.65% p.a. instead.

Coming in second is Maybank, offering 1.60% p.a. for deposits of at least $20,000 for 12 months. Do note, however, that this promotion is under the current/savings account bundle, which means you have to chuck a few grand into their CASA too. How it works is that for every $10,000 you place into fixed deposits, you must deposit $1,000 into a CASA (that’s $2,000 for the minimum $20,000 deposit).

That’s all for the promotions offering about 1.60% p.a., which is, to be honest, my personal threshold. Any lower and it probably wouldn’t be worth locking up your funds anymore.

If you’re not keen on foreign banks, then you kind of have no choice but to settle for a mediocre rate. 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.

Currently, UOB is the better of the two, offering 1.50% p.a. for minimum $20,000 deposits for 10 months.

 

Best fixed deposit promotions for $50,000 deposit

Bank/financial institution Min. deposit amount Tenure Promotional interest rates
Maybank $50,001 24 months 1.75% p.a. (online iSAVvy)
ICBC $20,000 12 months 1.70% p.a.
ICBC $20,000 3, 6 or 9 months 1.65% p.a.

As you can see, I’ve only listed the promotions offering 1.65% p.a. and up.That’s because $50,000 is a lot of money, so I wouldn’t settle for anything less.

Normally I’d look for something at least 1.70% p.a. and above, but given that March seems quite a slow month for time deposit promotions, let’s give chance a bit.

Unsurprisingly, those with at least $50,000 to mess around with can benefit from the best rates in the market. This Mar 2020, the best fixed deposit promotion is 1.75% p.a. for minimum $50,000 deposit, 24 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 April issue of SSBs offer 1.46% 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 1.60% 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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