Long queues have reportedly started forming outside Singapore banks recently, as they offer high interest rate promotions for fixed deposits.
Customers packed banks like United Overseas Bank (UOB) and OCBC Bank, lured by rates as high as 2.6% for 12 months.
Source: Shin Min Daily News on Facebook
That caused some to wait up to four hours for their turn.
On Friday (9 Sep), there was a queue of about 20 people outside UOB Bank in Toa Payoh Central, reported the Shin Min Daily News.
About eight to nine people were queueing at banks like DBS, OCBC and Maybank in Toa Payoh and Bishan Central.
On Saturday (10 Sep) morning, the scene was similar, with Shin Min noting that signs had been put up outside UOB and OCBC in Toa Payoh.
Source: Lianhe Zaobao
They said that they’ve been seeing more customers for matters related to account opening and fixed deposits.
Thus, customers should expect longer waits, and the banks will stop issuing queue numbers early.
For UOB, that means they won’t issue tickets 2 hours before closing time.
According to Shin Min, the waiting time outside some banks has gone up to four hours.
Over at the Central Business District (CBD), a UOB branch there estimated a two-hour wait on Wednesday (7 Sep) due to the customer surge, Bloomberg reported.
Source: Google Maps
A woman who tried to open a fixed deposit account for her parents during lunch found 79 in front of her.
She felt a fixed deposit was the safest place to put their money, and was also tempted by the interest rates, which are also at their highest in recent years.
Just how high are interest rates now?
UOB seems to be leading the pack, raising its rates to 2.6% for a 12-month term.
They’re also offering a 10-month fixed deposit at 2.4% in September, increasing it from 1.6% in August, reported Channel NewsAsia (CNA).
OCBC isn’t too far behind, with 2.3% interest for fixed deposits of 12 months.
DBS, on the other hand, has maintained its highest rate of 1.3%, according to Bloomberg.
RHB Bank, however, has a higher rate of 2.8% — but customers must bank in a minimum of S$20,000 for 24 months.
Hong Leong Bank offers 2.75%, but on a deposit of at least S$50,000 for 12 months.
Maybank has promotions for longer-term fixed deposits — 2.35% for 18 months and 2.4% for 24 months. They also have rates of 2.2% for 12 months and 2.3% for 15 months.
Standard Chartered Bank is dangling 1.8% for not more than S$25,000 in 12 months.
Fixed deposits are popular because savers can get a guaranteed sum of interest provided they put a fixed amount into a bank for a period of time. However, they aren’t allowed to withdraw the cash before the end of this period.
With local banks aggressively pushing up their rates, it’s no wonder customers a crowding banks.
Mr Goh Eng Yeow, a former Straits Times Money senior correspondent, wasn’t spared the jam either.
In a Facebook post on Friday (9 Sep), he said he couldn’t get his errands done at UOB’s main branch in town.
Source: Goh Eng Yeow on Facebook
That’s because they’d stopped issuing queue numbers at 2.30pm due to an overwhelming response to their 2.6% rate offer.
However, he said this shows that many Singaporeans were cash-rich but poor in financial literacy.
He pointed out that they could get a better yield from the latest six-month Treasury bills (T-bills) that the Government is offering.
T-bills are short-term Singapore Government Securities (SGS) issued at a discount to their face value and are issued for six months and one year.
He added that many are ignorant of this, as there’s little mainstream promotion.
Shin Min, however, did interview a mobile phone store employee who felt the same way.
Ms Yang Xiuyi, 48, said banks’ fixed deposit rates were still not attractive enough, adding that the Government’s short-term T-bills were more cost-effective.
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Featured image adapted from Shin Min Daily News on Facebook.
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