Best fixed deposit rates in Singapore (Sept 2022) - DBS, UOB, OCBC and more

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 (September 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 (September 2022)

 The State Bank of India Singapore’s interest rate is the highest amongst the banks here with its ongoing promotion of 2.57 per cent p.a. for 18 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% for a year. If you can afford to stash it away for a longer period of 36 months, you can earn up to 2.3% 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 (September 2022)

 Bank of China’s fixed deposit promotional rate offers a relatively high 2.35 per cent p.a. interest 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 2.35 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 2.35 per cent p.a. which is far better than the 0.05% p.a. interest you would earn with a regular savings account. Plus, you only have to stash your money away for a year to earn your 2.35 per cent interest.

4. Hong Leong Finance fixed deposit rates (September 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 2.4 per cent p.a. for a lock-in period of 15 months, it ranks second highest in terms of interest rate across the board. It also has a relatively short lock-in period of a little over a year. If you’re certain you won’t be needing extra cash on your hands for the next 15 months, Hong Leong Finance is a good place to put your cash and let it work for you.

5. CIMB fixed deposit rates (September 2022)

 Malaysian bank CIMB offers a pretty standard fixed deposit rate for the month with their 2.25 per cent p.a. promotion (till Aug 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 2.3  p.a.

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. To be eligible, you have to apply online.

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 2.35 per cent p.a..

6. DBS fixed deposit rates (September 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!

7. ICBC fixed deposit rates (September 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.

ICBC’s interest rates are also slightly above average when compared across the board. You get a 2.35 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 a lower 2.30 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 good fixed deposit rate to offer and a low commitment period of only a year. 

8. Maybank fixed deposit rates (September 2022)

 You can earn 2.3 per cent p.a. with Maybank’s Singapore Dollar Time Deposit. It is the standard fixed deposit rate that most banks are offering this month. You have to leave your money in for 15 months. A little over a year might not be an extended period of time but you can a higher interest rate with a lower minimum deposit amount with ICBC or Bank of China. 

However, if you’re looking to commit for a shorter time period, Maybank also offers 2.2 per cent p.a. for 12 months. 

9. UOB fixed deposit rates (September 2022)

Right now, local bank UOB is offering 2.3 per cent p.a. on their 15-month fixed deposits while promotion lasts till Aug 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 (September 2022)

Malaysian bank RHB is offering a 2.3 per cent p.a. fixed deposit interest rate.  If you are an RHB Premier customer, you get a higher 2.4 per cent p.a. interest rate instead. It’s on par with what most banks are offering this month. However, with RHB, you have to stash your funds away for two whole years and it also has a rather high minimum deposit requirement of $20,000. 

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. If you have $20,000 to stash away, you can earn the same interest in a shorter period of 15 months with Maybank, a fellow Malaysian bank.

11. Standard Chartered fixed deposit rates (September 2022)

 Standard Chartered’s fixed deposit rates are nothing to scream and shout about. At 2.2 per cent p.a. interest rate for a lock-in period of a year, Standard Chartered’s fixed deposit rates are currently amongst the lowest. If you have $25,000 to stash away for a little over a year (15 months), you’ll earn a better fixed deposit rate with Maybank or UOB.

If your existing time deposit with Standard Chartered has recently matured, there’s an ongoing renewal promotion. You can earn 2.0 per cent p.a. in interest if you renew your time deposit for another year. However, again, you would be better off parking that money at another bank that’s offering a higher fixed deposit interest rate.

12. HSBC fixed deposit rates (September 2022)

 HSBC offers a pretty decent 2.3 per cent p.a. for a tenure of 12 months. However, the drawback is that it requires a very high initial deposit of $30,000. If you don’t have that much funds to stash away, you can earn a higher interest rate of 2.35 per cent p.a. for a lower initial deposit of only $500 with ICBC.

Now that we’ve had a look at the interest rates banks have to offer, here’s a quick and easy summary of what you need to know about fixed deposits.

13. 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:

 14. 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% 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 per cent p.a., while even two-year rates are 2 per cent p.a. average return. The September 2022 SSB is slightly lower but still with an optimistic ten-year average return of 2.8 per cent p.a.. 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.