UOB increased the maximum interest rate on its flagship savings account from 3.6% to 7.8% in 2023 and we rejoiced.
[UPDATE] The party is over. UOB has announced a revision to the maximum interest rate on UOB One, read the latest here.
Since most of the time, your salary is already tied to one bank, switching banks may be difficult for some. However, you’re probably curious about how much you stand to gain or lose by staying with your current bank.
- Would the difference in interest rate make sense for you to finally switch banks?
- Is it even possible to take advantage of many savings accounts simultaneously?
I hope that by reading this post, you will be able to answer these questions based on your own financial situation and goals.
UOB One Savings Account
| Account Monthly Average Balance (MAB) | Spend min. S$500 (calendar month) on eligible UOB Card | Spend min. S$500 (calendar month) on eligible UOB Card AND make 3 GIRO debit transactions | Spend min. S$500 on an eligible UOB Card AND credit your Salary via GIRO |
| First $30,000 | 0.65% | 2.50% | 3.85% |
| Next $30,000 | 0.65% | 3.00% | 3.90% |
| Next $15,000 | 0.65% | 4.00% | 4.85% |
| Next $25,000 | 0.05% | 0.05% | 7.80% |
| Above $100,000 | 0.05% | 0.05% | 0.05% |
How to earn higher interest in UOB One Account:
- Make a minimum of $500 eligible card spend* your UOB Credit Card or UOB Debit Card to earn bonus interest on the UOB One Account.
*Refer to list of excluded transactions here
- 2a. Make a min. of 3 GIRO debit transactions payable to any Billing Organisations with the bank. Some possible organisations you could set up your Giro with include HDB, IRAS, Telcos and SP Services.
OR
- 2b. Credit a min. of S$1,600 salary monthly to your UOB One Account either through GIRO/PAYNOW with the transaction reference “SALA “/ “PAYNOW SALA”. Doing this, you would be able to get higher interest compared to the GIRO transactions.
To credit your salary to the UOB One Account, you will need to notify your HR department of your new account number.
Who is UOB One account best for?
If you want a hassle-free bonus interest, the UOB one is the best option. It has the fewest hoops to jump through to obtain the maximum bonus interest.
Apart from that, if you currently have multiple savings accounts and have your salary credited to another bank, UOB One is a great supplementary account since instead of crediting your money, you could opt for three Giro transactions, albeit at a reduced interest rate.
Pre-requisites to unlock 7.8% may not be for everyone⚠️
Of course, don’t get too excited about the 7.8% mentioned in the headline, as this is only applicable to deposits ranging from $75,000 to $100,000 after fulfilling all of the requirements listed above.
Realistically, for a $30,000 account balance, assuming you fulfil the conditions of $500 qualifying card spend and a minimum of $1600 income credit, your effective interest rate is roughly 3.85% pa. Even if you have $100,000 in your account, the effective interest rate is 5%, not 7.8%.
Eligibility and fees:
- Age: 18 years old and above
- Fall-below Fee: S$5 if the monthly average balance is less than S$1,000 (Waived for first 6 months for accounts opened online)
- Early Account Closure Fee: S$30 (Within 6 months from opening)
- Min. Initial Deposit: S$1,000
OCBC 360 Account
OCBC 360 account mechanics are nearly identical to UOB, with the exception of more options or, should I say, more hurdles to jump through in order to get the maximum bonus interest.
How to earn higher interest in OCBC 360 Account:
For OCBC, you can fulfil different categories, all of which are independent of one another. That is, you can choose to credit your Salary and spend $500 on your OCBC credit card to get 2.6% interest (2% + 0.6%).
Here is further information about each category.
Salary
- Credit your Salary of at least S$1,800 into the 360 Account.
- Only salary credit through GIRO with the transaction description “GIRO – SALARY” in your statements will qualify for this bonus.
Save
- Increase your account’s average daily balance in the current month by at least S$500 from the previous month’s average daily balance.
Spend
- Charge at least S$500 to your OCBC 365, OCBC Infinity OCBC NXT, OCBC 90°N or OCBC Titanium Rewards Credit Card.
Insure
- Purchase an eligible insurance product from OCBC.
- This bonus interest is accorded for 12 months after the effective date of purchase, post the free look/cancellation period or 14 days, whichever is longer.
Invest
- Purchase an eligible investment product from OCBC.
- This bonus interest is accorded for 12 months after the effective date of purchase, post the free look/cancellation period or 14 days, whichever is longer.
Grow
- Maintain an average daily balance of at least S$200,000.
Who is OCBC 360 best for?
OCBC 360 is ideal for those with a variety of needs because it provides a wide range of categories that are completely independent of one another. That is, you do not need to fulfil a specified category to receive extra interest. However, with so many categories, you will have more hoops to go through to acquire the highest interest rate. Not only that, but some of these categories, such as purchasing insurance or investing in an OCBC investment product, may not be viable in the long run because they are only valid for the first 12 months.
Similarly, OCBC’s quoted headline interest rate does not apply to the entire account amount.
Realistically, if you have an account balance of $75,000 (or less) and meet the Salary + Save + Spend criteria, your effective interest rate is 3.8%. If you have $100,000, this increases to 4.65%.
Eligibility and fees:
- Age: 18 years old and above
- Minimum average daily balance of $3,000 else there will be a fall below fee of $2 (waived for the first year)
- Min. Initial Deposit: $1,000
UOB One vs OCBC 306: Which high interest savings account is best?
As everyone’s circumstances are different, different banks may fit different people.
Of course, by now, you are probably with one of the banks, and as a working adult, you are probably busy, and changes will be a hassle.
With that, I think you can just stick with your bank as the interest rate would always change unless you have a unique circumstance in which one of the banks could provide you with more interest based on your spending habits.
Nevertheless, if you still wish to switch or if you are new to any of these accounts, below are some typical cases which you might be in:
Freelancer with no monthly income salary credited:
| Practical Interest Rate | Criteria | |
| OCBC | 1.80% (First $75,000 account balance. interest will increase with higher account monthly balance) | Increase your average daily balance by at least S$500 monthly + Charge at least S$500 to selected OCBC Credit Cards each month. |
| UOB | 2.50% (First $30,000 account balance. interest will increase with higher account monthly balance) | Spend min. S$500 (calendar month) on eligible UOB Card AND make 3 GIRO debit transactions |
Assuming you match the aforementioned conditions, UOB appears to be the superior option for freelancers in this circumstance.
Individuals with a Salary of $2,500 and minimum credit card spending of $500:
| Practical Interest Rate | Criteria | |
| OCBC | 2.60% (First $75,000. interest will increase with higher account monthly balance) | Credit your Salary of at least S$1,800 + Charge at least S$500 to selected OCBC Credit Cards |
| UOB | 3.85% (First $30,000 account balance. interest will increase with higher account monthly balance) | Spend min. S$500 on an eligible UOB Card AND credit your Salary via GIRO |
The effective interest rate you receive is determined by the amount of money in your savings accounts.
In the case of OCBC and UOB, the interest rate increases as the amount in your account grows. Nonetheless, UOB remains the better savings account in this area.
Individuals with a salary of $4,500 and minimum credit card spending of $500:
| Practical Interest Rate | Criteria | |
| OCBC | 3.80% (First $75,000. interest will increase with higher account monthly balance) | Credit your Salary of at least S$1,800 + Charge at least S$500 to selected OCBC Credit Cards + Increase your average daily balance by at least S$500 monthly. |
| UOB | 3.85% (First $30,000 account balance. interest will increase with higher account monthly balance) | Spend min. S$500 on an eligible UOB Card AND credit your Salary via GIRO |
Similarly, the effective interest rate you receive is determined by the amount of money in your savings accounts. Because the amount you make has no bearing on the interest rate you receive from UOB and OCBC, their rates are similar to an individual earning $2,500 per year.
The only change here is that I assume that individuals will save at least $500 monthly in the savings account, increasing the interest rate by 1.20% for OCBC account holders.
Highflyers with $100,000 savings on hand, with min. card spend of $500
| Practical Interest Rate | Criteria | |
| OCBC | 4.65% ($100,000 account balance) | Credit your Salary of at least S$1,800 + Charge at least S$500 to selected OCBC Credit Cards + Increase your average daily balance by at least S$500 monthly. |
| UOB | 5% ($100,000 account balance) | Spend min. S$500 on an eligible UOB Card AND credit your Salary via GIRO |
If you have $100,000 seating around and you wish to maximise your interest rates while keeping your funds liquid, UOB One still looks more enticing for new account holders. If you’re already have an OCBC 360 account, the difference in a year of savings would be about $350. You would need to decide if that is worth the switching cost of contacting your HR, applying for a new account and handling your payments with a new credit card.
Conclusion
This was a quick comparison of UOB One and OCBC 360 and how you may maximise your interest rate with them.
Since we all have unique circumstances, these high interest savings accounts would benefit different individuals; therefore, you should do a more in-depth assessment of your particular situation. Nonetheless, at the point of writing it appears that UOB is the more appealing, followed by OCBC.