The banks then take these deposits and lend the money to borrowers, such as home buyers for their mortgages or businesses for investments. Mr Christopher Gee, head of the governance and economy department at the Institute of Policy Studies, said that the business model of a retail bank is to take in deposits, usually from depositors, for a period of one to 12 months, though the durations can sometimes be longer. TODAY takes a look at how much higher can these interest rates go and what it means for lenders and consumers. One analyst noted that the last time interest rates soared this high was about 15 years ago, right before the global financial crisis in 2008, when Asia’s exports and growth plummeted due to severe recession in major economies. In response to TODAY’s queries, the bank said that it is constantly reviewing its deposit rates to ensure they remain competitive in view of market developments. Last August, United Overseas Bank (UOB) announced higher interest rates for its flagship savings account. The customer must have at least S$1,800 of salary credited via the interbank facility Giro monthly, must increase the deposit by S$500 a month and must spend at least S$500 monthly on certain OCBC credit cards. That rate comes with some strings attached, too. OCBC earlier this week also increased interest rates for its 360 savings account to an all-time high of 4.65 per cent a year on the customer’s first S$100,000, up from 1.85 per cent. To earn the full 4.1 per cent interest, a customer must carry out S$30,000 or more in eligible transactions a month, and credit their salary, dividends or Singapore Financial Data Exchange (SGFinDex) detail to the account. The rules around the Multiplier account can seem daunting. It last raised interest rates for its Multiplier account in August. SINGAPORE - As interest rates on borrowing here and around the globe rise rapidly to combat inflation, the grim news for home buyers facing heftier mortgage bills is good news for bank customers with savings deposits.Īgain this week, Singapore banks have been raising interest rates to stay competitive in the fight for deposits.ĭBS, the country's largest bank, on Tuesday (Nov 1) raised the interest rate again for its flagship Multiplier savings account from up to 3.5 per cent to up to 4.1 per cent a year on the first S$100,000 in a customer's account.

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