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OCBC tightens terms for 3% interest account
OCBC Bank has tightened the terms for its savings account offer that is now ranked top in its interest rate - a year after its launch.
This will put it closer in comparison with a savings scheme by DBS, as banks hunt down sticky deposits in this competitive consumer market.
The bank on Wednesday said it will revise the terms of its 360 account - which offers 3 per cent per annum in bonus interest annually on deposits up to S$50,000 - but will also introduce two new categories for customers to earn additional interest.
It has lowered the current maximum for the bonus interest to 2 per cent per annum, based on existing terms.
For customers to earn the bonus interest - which is on top of a base interest of 0.05 per cent per annum - they would have to use this as its salary crediting account, make payments through the account, and spend money through an OCBC credit card.
Customers will still earn one per cent per annum when they channel their wages into the account. But OCBC has cut the bonus interest attached to the payment and credit-card spending criteria by half. In addition, it has raised the monthly minimum spending on credit cards to S$500 from S$400.
The two new categories, and these changes, will take effect from May 1.
An OCBC spokeswoman said customers with accounts that satisfy the terms of the two new categories could have their deposits yield an interest of over 3 per cent annually. "In line with the bank's purpose to build enduring relationships with our customers, we are making enhancements to the 360 account so as to reward customers who do more with the bank," said Ling Seng Chuan, head of deposits, OCBC Bank. "The two new categories are introduced based on customer insights."
OCBC said this is not in response to the Singapore savings bonds programme. The bank, which has the smallest Sing-dollar deposit base among the three domestic banks as at the end of last year, began offering the 3 per cent bonus interest from April 2014. Within nine months, OCBC signed up 34,000 new customers, it said.
DBS, through its multiplier account, offers a 2.08 per cent per annum interest for accounts that have a total monthly cash flow of at least S$20,000. These include monies coming in - through the customer's salary, and investment dividends - and funds flowing out through credit-card spending, and mortgage instalments.
DBS's offering is also capped at S$50,000 in the account - the maximum insured amount per bank depositor by the Singapore Deposit Insurance Corporation.