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Minimum CPF interest rates extended by a year to Dec 31, 2021
CENTRAL Provident Fund (CPF) members will continue to receive the 4 per cent minimum interest rate for their Special, MediSave and Retirement Account (SMRA) monies for another year, until December 31, 2021.
The minimum rate was previously due to expire on Dec 31 this year.
The CPF Board and the Housing and Development Board (HDB) announced the extension in a joint statement on Friday. The agencies said the government has provided a 4 per cent floor rate since 2008 in light of global economic conditions, and exceptionally low interest rates.
From Oct 1 to Dec 31 this year, CPF members below the age of 55 will continue to be paid an extra 1 per cent interest on the first S$60,000 of their combined balances, with up to S$20,000 from the Ordinary Account (OA). The OA interest rate will be maintained at 2.5 per cent per annum, for the quarter.
This means members will earn up to 5 per cent interest per year on their Special and MediSave accounts, and up to 3.5 per cent interest per year for the OA, in the last quarter of 2020.
Meanwhile, CPF members aged 55 and above continue to receive an extra 2 per cent interest on the first S$30,000 of their combined balances, with up to S$20,000 from the OA. This means older members will earn up to 6 per cent interest per year on their retirement balances.
As the OA interest rate of 2.5 per cent per annum remains unchanged, the concessionary interest rate for HDB mortgage loans will likewise remain at 2.6 per cent per annum till Dec 31 this year. HDB's concessionary interest rate is pegged at 0.1 per cent above the OA rate, and the rates are reviewed quarterly.