DBS Bank Swoops Up the Rates on Multiplier Accounts
Just a head‑turning announcement from a local heavyweight: DBS Bank has lifted the interest rates on its Multiplier deposit accounts by as much as 0.8 percentage points.
Why This Move Stands Out
In a scene where every business feels the crunch of rising inflation and soaring mortgage rates, this is a vivid example of a bank playing the big card. Customers are now looking at higher returns on everyday savings – and that’s exactly what DBS is delivering. The move feels almost like a shout-out to people who’ve been trying to sit on a deposit and hope for the best.
Key Takeaways
- Higher Returns: You’ll earn more from your savings because the bank has bumped the rates.
- Incentive to Switch: The opportunity to ride higher rates, especially when the market is hot, might tempt a few of you to re‑evaluate where you keep your money.
- Response to Inflation: This is a timely reminder that, even as prices climb, banks can treat your money the way you want it—by offering extra sweetening.
Looking Ahead
It’s still early days. But with this update, DBS is positioning itself as the bank that actually cares about growing your stash, rather than just keeping it safe. Whether you’re a steady saver or a bold mover—this “rate‑up” shake‑up might just have you scrolling to check how much more your deposit could earn.
Reading the fine print
Cash, Card, & a Cha-Ching Bonus – The DBS Multiplier in Plain Talk
Think of your DBS Multiplier account as a secret sauce that turns ordinary savings into a glow‑up. If you’ve got a stash of $50k‑$100k sitting in your account, you can rub elbows with interest rates that swing up to 3.5 % per year, but only if you keep your spending wheel spinning in the right places.
Where’s the Action? (Eligible Categories)
- Using DBS/POSB credit cards for everyday purchases.
- Shopping with PayLah! Retail – your digital wallet’s favorite.
- Paying for insurance premiums.
- Covering home loan payments – because safe houses are the best kind of real‑estate.
- Investing in brokerage accounts – put your money to work like a personal trainer.
How the Rate Roller Works
Picture a tiered staircase where higher levels give you the better deal. The closer you stick to the categories, the higher you climb:
- First $25k – Lock in 1.1 % per year if you checkout just one category.
- First $50k – Hit 2.5 % per year when you tap into two categories.
- Between $50k‑$100k – The ultimate sweet spot: 3.5 % per year if you’re active in three or more categories.
So if you’re a multitasking moneyman, just press a few buttons and watch that interest rate your account keeps climbing!
What Happened During the Pandemic?
Like many banks around the globe, DBS had to trim these rates three times during the COVID‑19 pandemic. Think of it as a short sprint to keep the bank’s fishbowl balanced while the market was on a roller coaster.
Remember: the key is staying active in those categories, and the more you play, the more your savings take a spin into the higher rates zone.
Bank Bounces Back: UOB & OCBC Offer Sweet Interest Deals for Savvy Depositors
UOB’s One Account: Earn 3% on $75k‑$100k
- Balance Window: Keep between $75,000 and $100,000 and you’ll snag a nifty 3 % interest rate.
- Extra Boost: Add a $500 spend on an eligible UOB credit card and the rate chills even more.
- Salary Tweak: Your salary must drop straight into the account via General Interbank Recurring Order (GIRO). No, you can’t just send it in cash.
OCBC 360 Account: Up to 2.38% on the First $75k
- Savings Caps: First $75,000 in the account can grow at a fresh 2.38 % rate.
- Salary Requirement: You need a minimum salary of $1,800 credited via GIRO.
- Daily Balance Push: Your average daily balance must climb by at least $500 every month.
- Supplementary Products: Grab an eligible insurance policy or an investment product from OCBC to keep the urgency alive.
Why the Jolt? Money‑Making Amid Inflation
Goods and services are on the rise, and these “higher” interest rates are here to give your savings a little lift in the face of mounting costs. Think of it as a safety net that keeps your nest egg nibbled by the market’s beast.
Heads‑Up: The Catch
To lock in the best rates—up to 3.5 %—you must meet all the outlined criteria. That means precise balances, GIRO salary deposits, and in OCBC’s case, that extra insurance or investment card.
Take Action If You’re Ready to Max Out Your Deposits
- Check your current balance against the required thresholds.
- Set up or confirm a GIRO salary transfer.
- Consider the extra spends (credit card, insurance, investments) that align with the bank’s offering.
Ready to see your interest rates climb? Start by syncing your earnings and watching the numbers swell—your bank’s got the tools, you just need to build the foundation.
What about our CPF accounts?
Will CPF Interest Keep Up With Bank Rates?
When the banks rolled out tiered interest hikes, people kept asking the same question: does the CPF interest rate follow suit or does it stay stubbornly low?
The Riddle Behind Home Loan Payments
- Reality Check: In December 2021, a survey revealed that 2 of every 10 homeowners under 50 couldn’t cover their mortgage payments for at least half a year.
- Why It Matters: If inflation is eating into real wages, a static CPF rate could leave families scrambling to keep afloat.
- Potential Fix: A bump in CPF rates might offset the climb in bank rates, giving people a fighting chance to stay on track.
Bottom Line
It’s a hiccup worth exploring. The mortgage crisis of 2021 proves that when the cost of borrowing spikes, the safety net—CPF—needs to keep pace, or we’ll risk a generation of homeowners walking on thin ice.
How Rising Home‑Loan Rates Could Hit Your CPF Savings
Right now, about 800,000 homeowners are tapping into their CPF accounts to pay for their mortgages. But there’s a catch: no one has split the numbers into HDB flats versus private condos and executive residences. If you’re the kind who’s paying in CPF + cash on a condo or a high‑end private property, you might be in for a tougher time ahead.
What’s Behind the Rate Surge?
Let’s break it down in plain English. Between May and August 2022, two key benchmark rates that banks rely on for floating home‑loans went through the roof:
- Three‑month SORA (Singapore Overnight Rate Average) jumped from 0.32% to a staggering 1.27%.
- At the same time, Three‑month SIBOR (Singapore Interbank Offered Rate) more than doubled, leaping from 1.11% to 2.48%.
This dramatic hike left many banks feeling the pinch, prompting them to raise their fixed‑rate offerings:
- Two‑ and three‑year fixed‑rate loans now sit between 2.75% and 3.08% (previously 2.45%).
- DBS decided to scrap its five‑year fixed plan for HDB buyers that had been advertising a low 2.05%—now that price is a thing of the past.
Why CPF Might Be Your Lifeline (and Why It’s Not a Magic Fix)
Even with these higher rates, squeezing out extra interest from CPF can offer a tad of breathing room. Here’s why:
- CPF withdrawals are capped—once you hit that limit, you’ll have to dip into your own cash.
- At 55, you’re expected to earmark a Basic Retirement Sum—which throws another constraint on how much you can pull.
Bottom line: while CPF can cushion some of the cost, it won’t solve the problem entirely. You’ll still have to watch the interest rates closely and consider switching to a fixed plan if the market looks volatile.
Takeaway
Keeping an eye on both the market benchmarks (SORA, SIBOR) and your CPF balance is crucial. If you’re in the private condo or executive property scene, now is a good time to re‑evaluate your loan strategy and be ready for a bump in the mortgage hill.
Will CPF interest rates rise in tandem?
Why CPF Still Outshines Bank Rates, According to Minister Tan
During a lively debate in Parliament, MP Louis Chua grilled Minister Tan See Leng about why bank interest rates—especially DBS’s multiplier—continue to jump while CPF rates stay steady. He even threw in a comparison with GIC’s 7% nominal return over the last two decades.
Minister Tan’s Take on Long‑Term Security
- He explained that bank rate hikes are short‑term, volatile tools.
- In contrast, the CPF system is built on a long‑term, stable foundation to give members peace of mind when they hit retirement.
“Being custodians of members’ money, we keep a long‑term view to offer a fair return,” Tan said. “CPF rates remain attractive.”
How CPF Rates Get a Boost
- Government adds 1% extra interest on the first $60,000 of a member’s total CPF balance.
- Members aged 55+ receive an additional 1% on the first $30,000 of their balance.
So, as it stands:
| Under 55 yrs | Up to 5% interest |
| 55 yrs & above | Up to 6% interest |
Transfer to OA, Special or Retirement
When members shift their Ordinary Account (OA) funds into their Special or Retirement accounts, they benefit from a higher “risk‑free” rate. “That really shows how safe your savings are,” Tan emphasized.
What If CPF Rates Rise?
Tan highlighted that any drive to increase CPF rates comes from a thorough analysis of market conditions and fiscal levers. The potential “increment” hinges on a careful balance between member benefit and financial sustainability.
Bottom line? The CPF remains a reliable, long‑term investment—even in a market where banks are flirting with higher rates.
How CPF interest rates are derived
Circular Conversation: How CPF’s OA and SMRA Rates Move You, the Reader
*When the Minister delivered this week’s briefing, he’s basically telling you that your Ordinary Account (OA) is a bit like a savings jar that you can open at any time – whether you’re putting a down payment on a flat, finally paying off that mortgage, or just investing in something that says “future better.”
What’s the magic behind that ROI? Let’s dive into the bit‑by‑bit pay‑off.
Why OA Is Labeled “Liquid” – Because It’s All About Flexibility
*- Instant Withdrawal Policy: Anytime you need the cash, no waiting games.
- Uses: From buying a home to stepping up that mortgage balance or cherry‑picking a good investment.
- Rate Logic: Tied to the three‑month average fixed‑deposit and savings rate of the big local banks (DBS, UOB, OCBC).
The Formula History (because numbers love a good backstory):
- Originally a 50:50 split – half on fixed deposit, half on savings.
- Changed in July 1999 to an 80:20 split – a fresh-to-need shift to boost long‑term holding.
- Net effect: Acknowledged that OA money tends to stay with the CPF Board longer.
Take Note: From July to September 2022, the effective interest didn’t budge – staying at a bland 0.09%, mirroring the banks’ three‑month average. So, if you thought your money was doing something exciting, it stayed steady.
Moving to the SMRA: A Slightly More Serious Stakes
*- Stakeholders: Special Medisave and Retirement Account.
- Peg Formula: 12‑month average yield of 10‑year Singapore Government Securities + 1%.
- Pinned Rate: The latest press release earmarked it at 2.72%, which hosts around 3% after rounding.
Now, just so you know, since the Global Financial Crisis of 2008, the SMRA rate has snuck below 4% proudly. Despite that, the average delta—the extra amount CPF has nibbled above the peg—has sat on 0.9% across the last 14 years.
OA’s “Double the Delta” – The Real Talk
*- Since July 1, 1999, the OA’s delta has been double the SMRA’s: 1.8%!
- In plain terms: you’re earning a tad more on OA over time compared to SMRA, thanks to that 80:20 split.
Note on “Risk‑Free” – The Minister’s Comforting Words
*The Minister casually dropped “risk‑free” a few times. That phrase is basically a reminder that your money in OA or SMRA is backed by the very stable Singapore framework. It’s how the government assures you that your savings are safe, even if the rates are modest.
Bottom Line: Simplify, Save, and Think Far‑Ahead
*The takeaway? Think of OA as your “open‑to‑all” cash drawer – you get a steady (but low) 0.09% return and can use it whenever you need. SMRA is like a more “reserved” account that pulls from the market’s steady baseline and offers a slightly higher average bonus (about 1.8% versus 0.9%). Both are designed to keep your future protected, no matter the market’s twists.
No immediate change in CPF interest rate
CPF’s Cash‑Interest Confusion: The Low‑Rate Lowdown
Heads up: In the coming month, the CPF Board will be dropping new interest rates for the October–December 2022 quarter. Tan, a resident of CPF’s boardroom, says the rates are still just below the legal minimum (the “floor”). So, if the peg rates ever get above this floor, CPF members will sweeten their wallet’s gains.
What’s on the Menu?
- Ordinary Account (OA) – Stable at 2.5 %.
- Special Medisave Related Account (SMRA) – Sticking at 4 %.
- Other Accounts (Ordinary, Special & Medisave) – reviewed quarterly.
- SMRA – reviewed once a year.
Why No Quick Raise?
Even though the world’s economy has been buzzing with low rates since the Global Financial Crisis, the government still pays pretty decent rates thanks to those trusty floor rates. However, since the current rates sit under the minimum legal baseline, there’s no rush to jolt them up.
Bank Rates: A Tiny Influence
The OA’s interest ratchets on a two‑step system: 80 % of the peg is tied to the three‑month average fixed‑deposit rates of three major banks. Unfortunately, the recent tiered hikes in those banks don’t shake the peg much—nothing to worry about. The floor rate itself remains untouched.
Bottom Line
Unless the peg rates approach the minimum, the rates stay where they’re at. For now, CPF’s generous “delta” over the base rate is all the sweetener we’ll see.
This quick recap is brought to you straight from 99.co, your trusted news desk.
