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 mould on a piece of bread. Just leave it out in the open and mould 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 it. Fixed deposits are extremely low risk ways to grow your money.

You’ll be happy to learn that the fixed deposit rates are looking up again! Fixed deposit interest rates took a hit during Covid-19 but now the rates are back to pre-Covid days! If you’ve been holding out for the interest rates to pick back up, now might be a good time to park your spare money with a bank. 

1. Best fixed deposit rates in Singapore (July 2022)

We’ve picked the highest fixed deposit rates for SGD in attainable deposit amounts (i.e. $50,000 and below). 

Note that most of these promotional interest rates, which change monthly and the bank can change the rates anytime. The exception is DBS’ fixed deposit rate, which is non-promotional.

2. State Bank of India Singapore fixed deposit rates (July 2022)

The State Bank of India Singapore’s interest rate is one of the highest amongst the banks here with its ongoing promotion of 2 per cent for 15 months (minimum $25,000). If you’re looking for a lower minimum deposit of $5,000, you can opt for a shorter fixed deposit tenure, the State Bank of India Singapore offers an interest rate of 1.6 per cent for a year. If you can afford to stash it away for a longer period of 36 months, you can earn up to 2.2 per cent p.a.. 

Either way, it’s interest rates across the board are rather attractive and worth looking into regardless of the inconvenience of banking with a foreign bank. 

3. Bank of China fixed deposit rates (July 2022)

Bank of China’s fixed deposit promotional rate ranks one of the highest across the board at 2.1% p.a. and it gets better. The best part about Bank of China’s fixed deposit rate is that you only need a minimum deposit of $5,000 to get earn the 2.1 per cent interest rate. Typically, most banks require a minimum deposit of at least $10,000.

If you’re looking to get the most out of a smaller sum of your savings, you can still leverage on Bank of China’s 2.1 per cent p.a. which is far better than the 0.05 per cent p.a. interest you would earn with a regular savings account.

4. Hong Leong Finance fixed deposit rates (July 2022)

Apart from the big banks like DBS, UOB and OCBC, the fixed deposit aficionado should also look at non-bank financial institutions like Hong Leong Finance as they also offer promotions. They may not be quite as risk-free as banks, though.

Given its current fixed deposit interest rate of 1.88% p.a. for a lock-in period of 24 months, the is not even be worth taking. You can find better interest rates for the same lock-in period elsewhere.

Not really worth your time if you ask us. Keep scrolling!  

5. CIMB fixed deposit rates (July 2022)

Malaysian bank CIMB offers pretty high fixed deposit rates for the month with their 1.95 per cent p.a. promotion (till July  31, 2022) if you are not a CIMB Preferred customer. If you’re a CIMB Preferred customer, you’ll enjoy an even higher rate of 2 per cent.

This promo is for deposits of at least $10,000. To enjoy this rate, you need to lock up your money for 18 months. This promo extends to both new and existing CIMB Personal Banking and CIMB Preferred customers.

If you’re looking to deposit smaller amounts of your savings into a fixed deposit account, CIMB only offers up to 0.3 per cent p.a.. In this instance, you would be better off placing your money with Bank of China where you can earn 2.1 per cent p.a..

6. DBS fixed deposit rates (July 2022)

The current highest DBS fixed deposit rate is 1.3 per cent p.a. for those who have $1,000 – $19,999 for 18 months. However, DBS has stopped taking in fixed deposits above eight months. So, if you’re already on an existing DBS fixed deposit programme, heng ah!

If you’re opening a new fixed deposit account, the highest you can go is 0.85 per cent p.a. for 8 months. The only consolations are that the lock-in period is relatively short, and the minimum of $1,000 is quite a manageable amount. Still beats having your cash parked in a regular savings account!

ALSO READ: 3 benefits & drawbacks of fixed deposits to consider before opening an account

7. ICBC fixed deposit rates (July 2022)

It used to be that you needed at least $20,000 lying around in order to benefit from the higher promotional interest rates. However, the lower-commitment options have become a lot more competitive of late.

There are a few fixed deposits which have pretty low barriers to entry on this list, but Chinese bank ICBC takes the cake by requiring just a $500 minimum deposit.

With that said, ICBC’s interest rates when compared across the board are far from stellar. You get a 1.75 per cent p.a. (if you apply for this fixed deposit online via ICBC e-banking) with a commitment period of 12 months.

When you do it the old school way, you’ll get an even lower 1.70 per cent p.a. and you’ll have to hit a minimum deposit requirement of $5,000.

If you’re looking to start somewhere, ICBC has a low barrier of entry, a decent enough fixed deposit rate to offer and a low commitment period of only a year. 

8. Maybank fixed deposit rates (July 2022)

You can earn 1.8 per cent p.a. with Maybank’s Singapore Dollar Time Deposit. Unfortunately you have to leave it in for 36 months (Three whole years!) to earn that amount. It is one of the highest across the board at the moment but if you don’t want to commit for the time it takes to build a BTO flat, there are shorter commitment fixed deposits. 

If you’re looking to commit for a shorter time period, Maybank also offers 1.3 per cent p.a. for 12 months or 1.6 per cent p.a. for 24 months.

9. UOB fixed deposit rates (July 2022)

Right now, local bank UOB is offering 2 per cent p.a. on their 15-month fixed deposits while promotion lasts till July 31, 2022. While the lock-in period is relatively short at a little over a year, it still does require a minimum deposit of $20,000. 

Note that if you have an UOB fixed deposit that’s maturing this month, UOB will auto-renew your account at the current “promotional” rate. You might want to check and update your standing instructions.

10. RHB fixed deposit rates (July 2022)

Malaysian bank RHB‘s interest rate tops the table with 2.25 per cent per annum. If you have $20,000 to spare and lock away for two years, RHB is where you can go. If you are an RHB Premier customer, you get a higher 2.3% interest rate instead.

Of course, not forgetting that RHB is also a foreign bank and you already know the risks involved with that. Whether the risk is worth taking, it’s your call.

11. What about HSBC and Standard Chartered fixed deposits?

The rest of the banks — Standard Chartered and HSBC — are offering even poorer deals on their fixed deposits, which is hardly worth your time.

In fact, you can get 1% p.a. on your savings (up to $10,000) with no lock-in just by opening a regular CIMB FastSaver account and charging $300 to a CIMB Visa Signature Credit Card.

Of course, banks are notoriously fickle about their interest rates, and all these 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 easy summary of what you need to know about fixed deposits.

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

Once an attractive alternative to the 0.05% p.a. interest on savings accounts, fixed deposits are fading from collective memory. Today, every bank in Singapore is competing for your dollar with high interest savings accounts, which may actually offer better returns.

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

13. Fixed deposit vs Singapore Savings Bonds (SSB) — 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, interest rates. Believe it or not, fixed deposit interest rates were actually higher than SSBs in 2021. The March 2021 issue of SSBs offered a measly 0.35 per cent p.a. interest average return after the first two years. However, things have completely changed in the past year.

In fact, the Singapore Savings Bonds interest rates are better than they have ever been. The August 2022 Singapore Savings Bond (SSB) has a ten-year average return of 3% p.a, while even two-year rates are 2 per cent p.a average return. While fixed deposit interest rates might be more attractive than SBSs in the short term, SBSs outperform fixed deposit rates in the long run. 

Next, entry point. It takes just $500 to invest in Singapore Savings Bonds, which is lower than the $1,000 or more for most fixed deposits. That said, ICBC fixed deposits only require $500 to start. (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.)

Finally, tenure. Fixed deposits are shorter term investments. After the lock-in 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.

This article was first published in MoneySmart.