We don’t invest all our cash. Most of us keep some cash in a savings account, whether to pay bills or to invest when the opportunity comes.
So which bank in Singapore gives us the highest interest rate for a savings account?
[Update June 2019: CIMB FastSaver now pays 1% on your first $50k and 1.5% on your next $25k. This gives you an effective rate of 1.167% if you maintain a balance of $75k.]
The highest interest rate I’ve seen in recent times used to be from Standard Chartered Bank CDA Account. Strictly speaking, this is also not a traditional savings account, but if you are a parent, it’s almost equivalent. See our previous article on Baby Bonus CDA Account.
However, the Stanchart CDA has been paying an interest of only 0.5% since November last year. It used to give out 1.0% previously.
More recently, many banks have advertised seemingly attractive rates for their savings accounts.
For example, Stanchart e$aver promises “up to” 0.9%, but when you read the fine print, it’s valid only during the “promotional period” till 31 March 2012. What happens thereafter is anyone’s guess. In my opinion, the rate is very likely to go down. Stanchart, please prove me wrong.
On the other hand, CIMB StarSaver pays a 0.8% interest on a more palatable condition (to me) – you just have to make regular monthly deposits of at least $500. And CIMB, in my opinion, has been more consistent with its relatively high interest rates (it previously paid 0.9% a year ago) and it’s less gimmicky in its advertising. The only downside is perhaps the fact that CIMB has only 2 branches in Singapore.
If there’s no other bank more generous in their interest payments, Salary.sg recommends this strategy if you have $200k or more: Use Stanchart e$saver until 31 March, and then move your money to CIMB StarSaver.