When Singaporeans don’t like something, you’ll know it. Take that critically panned Criminal Minds: Beyond Borders episode set in Singapore (but not actually filmed in Singapore). It was so bad it wasn’t just a news story on mainstream media, but Blogfather mrbrown even did TWO videos in character as Kim Huat, Singapore’s No. 1 Police TV show fan. TWO. VIDEOS. A total of 1.2 million views. In 48 hours. Good job. I salute you.
In that same span of time, UOB launched a new savings account, the KrisFlyer UOB Account. Marketed as “A new way to bank and fly” – a savings account that can earn you up to 5.4 KrisFlyer miles per $1! That’s unprecedented in Singapore.
However, about 24 hours later, criticisms about the extreme requirements to earn 5.4 miles arose. Hardcore local air miles website The MileLion even went so far as to proclaim “The KrisFlyer UOB Account is Dead on Arrival”. So is the KrisFlyer UOB Account that bad?
Okay, chope, how does KrisFlyer UOB Account work?
Open a Krisflyer UOB Account and get a really pretty KrisFlyer UOB Debit Card connected to it, and you earn air miles for every $1 you spend on the Debit Card. Seems simple, right?
As with all things UOB (we’ll talk more about this later), there’s a bunch of hoops you need to jump through and tiers to navigate. Gotta admire their consistency.
So, what’s wrong with the KrisFlyer UOB Account?
First, you need to have at least $3,000 in your savings account to even smell your “bonus” air miles. Your savings account balance determines how many miles you can earn when you spend with the Debit Card. But what really upset people was the discovery that to earn the top tier of 5.4 miles per $1 spent, your minimum account balance needs to be $350,000 or more!
Hello. This is Singapore. The only places we have $350,000 or more is our CPF Accounts or in the “stored asset” value of our HDB flats.
And that’s not all. After combing through the terms and conditions (we’ll get to this later), people discovered that the KrisFlyer UOB Account doesn’t earn any interest. It wasn’t that hard to find. The header simply states “No Interest”.
In fact, if you don’t spend on the KrisFlyer UOB Debit Card, you won’t earn KrisFlyer miles, no matter how much you have in the bank.
Yeah, all that money UOB wants you to deposit into their bank? It’s technically not earning anything.
Don’t even get me started on the fact that the KrisFlyer miles you earn, like all KrisFlyer miles, expire after 3 years.
So, as The MileLion said, it’s dead on arrival, right?
Only if UOB refuses to make any changes to the account. As we see it, the purpose of the account is valid.
The KrisFlyer UOB Account is targeted at young people who are new to earning air miles and may not even be eligible for an air miles credit card. These jetsetters are going to be travelling a lot anyway, so it makes sense to give them an opportunity to earn air miles from their spending.
Instead of continuing with the account bashing, here’s three ways which we would improve the KrisFlyer UOB Account to better suit this target audience:
1. KrisFlyer Miles that don’t expire
Look, if you’re targeting young people who don’t earn enough for a normal air miles credit card (i.e. on average an annual income of about $50,000 a year) then you’re definitely looking at students about to graduate, or fresh grads in their first job. Expecting them to earn enough KrisFlyer Miles in 3 years to go anyway further than Batam is impractical. KrisFlyer should look into allowing the KrisFlyer UOB Account to earn Miles that don’t expire.
This change alone may even encourage those outside the target audience to give the Account a second chance.
2. Revise those silly tiers
Right now, the only way to earn more than 1.4 Miles per $1 spent is to have a minimum account balance of $100,000 or more. That’s a ridiculous expectation for someone who has barely started earning. Even with the worst savings account out there, you can earn significantly more than that on interest alone. Heck, even the UOB One Account is more enticing than the KrisFlyer UOB Account, the way it’s currently structured.
Even just changing the next tier to a $10,000 minimum account balance would make it more obviously targeted at a younger customer base.
At this juncture, just take a short moment to imagine $350,000 of your money sitting in an account. Doing nothing. Just sipping on a piña colada. That’s all.
Yeah, we all know no one’s ever putting that amount of money in.
3. Forcing spending while saving is a double-edged sword
A savings account that doesn’t reward saving is like a TV episode that’s set in Singapore but doesn’t even want to do research about Singapore, let alone film on location.
The KrisFlyer UOB Account doesn’t earn any interest on the account balance, but if you don’t hit the minimum account balance because you’ve been spending on the KrisFlyer UOB Debit Card, you may slip to a lower tier.
Reward BOTH spending AND saving, and don’t make them work against each other. That’s how the UOB One Account works after all! Imagine an account that earns you air miles based on the amount you deposit, as well as when you spend on the card. That would at least make more sense in giving people a reason to leave their money there.
4. UOB, please stop relying on the fine print
UOB is infamous for their fine print, but this product is the champion in terms of misleading. Not only was the fact that there would be no interest accrued hidden in the terms and conditions, but it seems like the “up to 5.4 Miles per $1 spent” is a “promotion”. That’s right, the terms and conditions don’t state any values.
That means that UOB is telling you upfront that they are probably going to revise the miles accrual rates when 30th April 2018 comes around. That’s when the “promotion” ends. And why should anyone commit to a product where they have no visibility beyond April next year?
Ironically, this is the opposite of the OCBC 360 Account, which gave customers the impression that their rates were set in stone, but then changed them two times in the past three years.
[Edit: According to UOB, the “promotional period” is just a fixed period before they review the bonus miles offer. It’s not going to disappear but of course whenever you say “promotional” anything, no one’s going to have a positive outlook on that (which we conveyed directly to them).]
UOB needs to stop pretending the fine print doesn’t exist
We promised you we’d talk about it, and here it is:
This isn’t UOB’s first product where the fine print told a very different story from the promotional material.
Take the UOB One Card, for example, which boasts that it’s “Singapore’s most generous rebate card”, but in the fine print it states,
“based on a retail spend amount of $2,000 per month for 3 consecutive months”.
Elsewhere it claims, “up to 5% Cash Rebate on ALL spend”. But in the footnotes,
“Enjoy up to 3.33% cash rebate based on a spend of S$500 or S$1,000 monthly for each qualifying quarter with min. 5 purchases monthly to earn the quarterly cash rebate of S$50 or S$100 respectively. Enjoy up to 5% cash rebate based on a spend of S$2,000 monthly for each qualifying quarter with min. 5 purchases monthly to earn the quarterly cash rebate of S$300. Each qualifying quarter consists of 3 consecutive statement periods. Please refer to full set of UOB One Visa Credit Card Terms and Conditions.”
In other words, there is only 1 very specific instance where you can enjoy 5% rebates. Any other instance, and you’re more likely to earn 3% or in a worst-case scenario. Come on, UOB! How many hoops do you need us to jump through just for 5% rebates? That’s the exact opposite definition of “generous”.
But the UOB One Card has nothing on the UOB One Account. In a classic case of marketing spin (otherwise known as fudging the truth), it advertises a savings account with “up to 3.33% per annum interest rates”.
But in the fine print,
“Maximum effective interest rate (EIR) on the One Account is 1.60% p.a. for deposits of S$50,000, provided customers meet the criteria of S$500 Card Spend. Maximum effective interest rate (EIR) on the One Account is 2.43% per annum for deposits of S$50,000, provided customers meet both criterias of S$500 Card Spend and S$2,000 salary credit or 3 GIRO debits per month.”
In other words, we weren’t telling you the whole truth about the 3.33% interest rates! In fact, the maximum interest you can earn from the UOB One Account is 2.43%, and ONLY if you put in EXACTLY $50,000.
But here’s the thing… UOB does have good products!
Yes, there are hoops that Singaporeans need to jump through to earn 5% rebates of the UOB One Card, or the 2.43% maximum interest you can get from the UOB One Account. But the fact is, there are people out there who believe it’s worth their extra effort. Despite the questionable marketing, and the over-reliance on fine print, the products themselves are solid.
The Krisflyer UOB account is not solid.
But is it “dead on arrival”? We don’t think so. Should UOB take some of our suggestions, and work quickly, they’ll be able to give the product a much-needed adrenaline shot and give it a second lease on life.
What do you think about the new Krisflyer UOB account? Share your thoughts with us.