The annual OCBC survey highlights the financial struggles of Singaporeans, with many unable to afford beyond basics and lacking emergency funds, amid high interest rates, inflation, and market turmoil.
“2023 has been yet another tough year, with the continuation of high interest rates, inflation, and turmoil in the financial markets,” says OCBC’s head of group wealth management, Tan Siew Lee.
However, Despite these challenges, young millennials show optimism towards achieving investment and retirement goals, focusing on savings for financial success.
Choosing the right savings account can significantly impact financial growth. Here, we will delve into the key features, differences, and detailed comparison between the two popular high-interest savings accounts in Singapore– OCBC 360 and DBS Multiplier
OCBC 360 Savings Account Overview
The OCBC 360 Savings Account is a high-interest savings account that offers tiered interest rates based on various banking activities. It is designed for individuals who are looking to maximize their interest earnings by meeting specific criteria.
Key Features
- Tiered Interest Rates: The account offers different interest rates based on activities such as salary credit, bill payments, and insurance or investment purchases.
- Bonus Interest: Account holders can earn bonus interest for fulfilling certain conditions, with the potential Effective Interest Rate (EIR) reaching up to 4.65% per annum on the first S$100,000 of the account balance.
- Base Interest Rate: The account comes with a base interest rate of 0.05%.
Earning Bonus Interest
To qualify for higher bonus interest rates, account holders can engage in the following activities:
- Salary Crediting: Earn additional interest by crediting your salary to the account.
- Bill Payments: Receive bonus interest for paying bills through the account.
- Credit Card Spending: Earn extra interest by spending on an OCBC credit card.
Take a look at this interest structure to learn more about how you can earn more:
| Category | Conditions | Account Daily Average Balance (DAB) | ||
|---|---|---|---|---|
| Bonus Interest for First S$75,000 | Bonus Interest for Next S$25,000 | Effective Interest Rate (EIR) | ||
| Salary | Credit salary of at least S$1,800 through GIRO/PayNow via GIRO. | 2.00% | 4.00% | 2.50% |
| Save | Increase your average daily balance by at least S$500 monthly. | 1.20% | 2.40% | 1.50% |
| Spend | Charge at least S$500 to selected OCBC Credit Cards each month. | 0.60% | – | 0.60% |
| Insure | Purchase eligible insurance products from OCBC. | 1.20% | 2.40% | 1.50% |
| Invest | Purchase an eligible investment product from OCBC. | 1.20% | 2.40% | 1.50% |
| Grow | Maintain an average daily balance of at least S$200,000. | 2.40% | – | 2.40% |
(Source: OCBC 360 Account)
Pros and Cons
- Pros: The OCBC 360 account is ideal for individuals who can meet multiple criteria to maximize their interest earnings. Unlike the UOB One, bonus interest accumulates with each eligible action you complete, providing flexibility in earning additional interest.
- Cons: The account may have caps on the balance that earn higher interest, which could limit the total interest earned for some account holders.
DBS Multiplier Savings Account Overview
The DBS Multiplier Savings Account is a popular choice among savers, known for its flexibility and attractive interest rates. It rewards account holders based on their total transaction volume across various categories.
Key Features
- Interest Based on Transaction Volume: The account provides interest rates that increase with the total transaction volume, which includes salary, credit card spending, and investments.
- Maximum Interest Rate: Offers a maximum interest rate of 4.10% p.a.
- No Initial Deposit Required and Low Daily Average Balance: Account holders are not required to make an initial deposit and only need to maintain a daily average balance of S$3,000.
Earning Bonus Interest
Starting from 1 August 2023, here’s how you can earn bonus interest in the DBS Multiplier Account:
- Credit Your Income: Receive your salary or other income directly into the account.
- Transact in One or More Categories: Engage in transactions across categories like credit card/PayLah! retail spend, home loan installment, insurance, and investments.
- Minimum Spend: Ensure a minimum monthly spend of S$500 to qualify for higher interest rates.
Take a look at this interest rate structure:
| Income + one category | Income + two categories | Income + three or more categories | |
|---|---|---|---|
| Total eligible transactions per month | First S$50,000 balance | First S$100,000 balance | First S$100,000 balance |
| S$500 or more to below S$15,000 | 1.80% p.a. | 2.10% p.a. | 2.40% p.a. |
| S$15,000 or more to below S$30,000 | 1.90% p.a. | 2.20% p.a. | 2.50% p.a. |
| S$30,000 or more | 2.20% p.a. | 3.00% p.a. | 4.10% p.a. |
(Source: DBS Multiplier Account)
Pros and Cons
- Pros: The account is suitable for those with a high total transaction volume across multiple categories. Recent changes, such as combining credit card/PayLah! retail spend into one category and lowering the qualifying DBS/POSB transactions from S$2,000 to S$500 have made it easier to earn higher interest.
- Cons: Lower transaction volumes may result in lower interest rates, which could be a drawback for some account holders.
Detailed Comparison
OCBC Account Interest Rates
OCBC offers tiered interest rates that incentivize specific saving and spending behaviors:
- Salary Crediting: When you credit your salary of at least S$1,800:
- First S$75,000: Interest is 2.00% p.a.
- Next S$25,000: A higher rate of 4.00% p.a. applies.
- Effective Interest Rate (EIR): This averages to about 2.50% p.a.
- Increasing Savings: For increasing your average daily balance by at least S$500 monthly:
- First S$75,000: Earn 1.20% p.a.
- Next S$25,000: Earn a higher 2.40% p.a.
Other categories like spending, insurance, investments, and maintaining a higher balance are also rewarded with varying rates, ranging from 0.60% to 2.40% p.a.
DBS Multiplier Account Interest Rates
The DBS Multiplier Account encourages customers to engage in more banking activities by offering higher interest rates for a higher number of transaction categories met. Here’s how it works:
- Low Transaction Volume: For total eligible transactions between S$2,500 to under S$15,000:
- Income + 1 category: Earns 1.80% p.a. on the first S$50,000 balance.
- Income + 2 categories: Earns 2.10% p.a. on the first S$100,000 balance.
- Income + ≥3 categories: Earns 2.40% p.a. on the first S$100,000 balance.
- High Transaction Volume: For transactions of S$30,000 and above:
- Income + 1 category: Interest jumps to 2.20% p.a.
- Income + 2 categories: Increases to 3.00% p.a.
- Income + ≥3 categories: Peaks at 4.10% p.a., showcasing the account’s highest potential rate.
Scenario Comparisons
| Scenario | DBS Multiplier Account | OCBC Account |
|---|---|---|
| Meeting One Criterion | 1.80% p.a. for income + 1 category | 2.00% p.a. for salary crediting alone on first S$75,000 |
| Multiple Criteria and Higher Balances | Up to 4.10% p.a. for income + ≥3 categories and high transaction volume | 4.00% p.a. for the next S$25,000 with increased balance |
| Low Balances and Transactions | Lower rates for lower balances and fewer transactions | Potentially better rates for salary crediting without additional requirements |
| Higher Balances and Varied Transactions | More attractive rates for higher balances and meeting multiple criteria | Competitive but specific to saving behaviors |
When you credit income and engage in categories like retail spending, home loans, insurance, and investments, the interest rates with DBS can be quite rewarding, especially as your transaction volume increases. OCBC, on the other hand, offers competitive rates for salary crediting and saving behaviors. Each account has its own merits, and the best choice depends on your personal financial activities and goals.
To further explain, consider these scenarios:
Scenario 1: The Young Professional
Alex, a 28-year-old marketing executive, earns S$3,500 a month and spends S$600 on his credit card, including bill payments. He doesn’t have loans or investments but plans to buy insurance.
- OCBC 360: Fits Alex’s profile as he meets the salary credit requirement and card spend, earning him a total of 2.00% + 0.60% interest.
- DBS Multiplier: Less beneficial since he has only one category of transactions apart from his income, which would earn him 1.80%.
Scenario 2: The Savvy Investor
Priya, a 35-year-old IT consultant, has a monthly income of S$8,000, invests S$2,000 monthly, and uses her credit card for S$1,000. She also pays a home loan installment of S$2,500.
- DBS Multiplier: Ideal for Priya as she engages in multiple categories with high transaction volume, maximizing her interest rate potentially up to 3.00% or more depending on the total transactions.
- OCBC 360: She would earn a decent rate for salary, spending, and investing, but less than DBS Multiplier since her high transaction volume is better rewarded there.
Scenario 3: The Mid-Career Homeowner
John, 40, with a monthly income of S$6,000, has a home loan installment of S$2,000 and an insurance premium of S$300. He also invests S$1,000 monthly and saves an additional S$1,000.
- DBS Multiplier: Beneficial as his income, home loan, insurance, and investments fall into different categories. His transaction volume could elevate his interest rate.
- OCBC 360: Also suitable as John can earn bonus interest across salary, spending, insuring, and investing, but the total rate may be slightly lower than DBS.
Scenario 4: The Conservative Saver
Lily, a 30-year-old teacher, earns S$4,500 a month, saves S$500, and spends S$800 on her credit card. She is not into investments or loans yet.
- OCBC 360: A good fit for Lily, as she can easily meet the salary and spend categories, and her saving habit also earns her bonus interest.
- DBS Multiplier: Not as rewarding unless Lily increases her transaction categories or volume.
Account Requirements
- OCBC 360: To maximize interest earnings, account holders need to meet multiple criteria, such as salary crediting, bill payments, and insurance or investment purchases. The account offers flexibility, as bonus interest accumulates with each eligible action.
- DBS Multiplier: The account requires a minimum spend of S$500 per month and transactions in one or more categories (e.g., credit card/PayLah! retail spend, home loan installment, insurance, investments) to qualify for higher interest rates.
Best For
- OCBC 360 Savings Account – Best for Young Professionals with Moderate Spending: A young professional with a moderate salary and credit card spending might find the OCBC 360 account more beneficial due to its tiered interest rates and flexibility in earning bonus interest.
- DBS Multiplier Savings Account – Best for High Earner with Diverse Financial Activities: An individual with a high salary, significant credit card spending, and investments would likely benefit more from the DBS Multiplier account, especially with the recent changes that make it easier to earn higher interest rates.
Unique Features and Considerations
Both the OCBC 360 and DBS Multiplier savings accounts offer unique benefits, but they also come with their own set of considerations for long-term financial planning.
OCBC 360 Savings Account
Unique Benefits:
- Bonus Interest for Insurance: Account holders can earn bonus interest by purchasing insurance products through OCBC, adding an additional layer of financial benefit to their insurance decisions.
- Flexibility in Earning Interest: The account allows for earning bonus interest across various activities, such as salary crediting, savings, credit card spending, or financial products, providing more flexibility in how you manage your finances.
Considerations:
- Interest Rate Caps: The account has caps on the balance that earn higher interest, which could limit the total interest earned for those with larger balances.
- Potential Changes in Terms: Like any financial product, the terms and conditions of the OCBC 360 account can change, which may affect the long-term benefits.
DBS Multiplier Savings Account
Unique Benefits:
- Flexibility in Qualifying Transactions: The recent changes to the account, including combining credit card/PayLah! retail spend into one category and lowering the qualifying transactions threshold, make it easier for account holders to earn higher interest rates.
- High Maximum Interest Rate: With a maximum interest rate of 4.10% p.a., the DBS Multiplier account is competitive for those with high total transaction volumes.
Considerations:
- Lower Interest Rates for Lower Transaction Volumes: Account holders with lower transaction volumes may find that the interest rates offered are less competitive compared to other accounts.
- Dependence on Total Transaction Volume: The interest rates are heavily dependent on the total transaction volume, which may fluctuate based on spending habits and financial circumstances.
Factors to Consider When Choosing Between OCBC 360 and DBS Multiplier
When deciding between the OCBC 360 and DBS Multiplier savings accounts, it’s crucial to consider several factors that align with your lifestyle and financial habits.
Average Monthly Transactions
- OCBC 360: If your average monthly transactions are moderate and you can meet multiple criteria such as salary crediting, bill payments, and insurance or investment purchases, the OCBC 360 account may be more suitable for you.
- DBS Multiplier: If you have a high total transaction volume across various categories, the DBS Multiplier account might be a better fit, especially with its potential maximum interest rate of 4.10% p.a.
Ability to Meet Account Criteria
- OCBC 360: Consider whether you can consistently meet the account’s criteria, such as crediting your salary of at least S$1,800 or spending at least S$500 on OCBC credit cards per month, to maximize your interest earnings.
- DBS Multiplier: Evaluate if you can maintain the minimum monthly spend of S$500 and engage in transactions across multiple categories to qualify for higher interest rates.
Long-Term Financial Goals
- OCBC 360: If your long-term financial goals involve building a diversified portfolio with insurance or investment products, the OCBC 360 account’s bonus interest for these activities might align well with your objectives.
- DBS Multiplier: If your goals include maximizing savings through high transaction volumes, the DBS Multiplier account’s emphasis on total transaction volume could be more beneficial.
Impact of Lifestyle and Financial Habits
- OCBC 360: This account may be more suitable for individuals who prefer a structured approach to managing their finances, with specific activities leading to bonus interest.
- DBS Multiplier: For those with a more dynamic lifestyle and varied financial activities, the DBS Multiplier account’s flexibility in qualifying transactions might be a better fit.
FAQs
1. Which is better, OCBC 360 or DBS Multiplier?
The better choice between OCBC 360 and DBS Multiplier depends on your financial habits and goals. If you can meet multiple criteria and prefer tiered interest rates, OCBC 360 might be more suitable. If you have high transaction volumes across various categories, DBS Multiplier could be a better fit due to its flexibility in qualifying transactions and the potential for higher interest rates.
2. Is OCBC better than DBS?
Comparing OCBC and DBS as a whole is challenging, as each bank has its strengths and offerings. For savings accounts, it depends on the specific features of the accounts in question and your personal financial needs. Both OCBC 360 and DBS Multiplier have unique advantages that cater to different user profiles.
3. What are the cons of the DBS Multiplier?
The cons of the DBS Multiplier account include:
- Lower interest rates for lower transaction volumes, might not be as competitive for individuals with limited financial activities.
- Dependence on total transaction volume for higher interest rates, which may fluctuate based on spending habits and financial circumstances.
4. Is OCBC 360 worth it?
OCBC 360 can be worth it if you can consistently meet the account’s criteria to maximize your interest earnings. It offers flexibility in earning bonus interest across various activities and is ideal for individuals who prefer a structured approach to managing their finances. However, it’s essential to consider the caps on the balance that earn higher interest and ensure that the account aligns with your financial goals.
Conclusion
The choice between OCBC 360 and DBS Multiplier depends on your financial habits and goals. Both accounts offer unique benefits and cater to different user profiles. Carefully evaluate both options to determine which savings account best aligns with your financial objectives, ensuring that your selection supports your long-term financial strategy and lifestyle.
Key Takeaways
- Selecting between OCBC 360 and DBS Multiplier depends on your financial behavior; OCBC 360 is best for individuals with stable financial activities, whereas DBS Multiplier favors those with extensive and varied banking transactions.
- OCBC 360 suits those with regular financial routines through tiered interest for specific activities, while DBS Multiplier rewards higher transaction volumes across various categories, ideal for users with diverse banking engagements.
- OCBC 360 offers bonus interest for fulfilling certain criteria, perfect for users with predictable banking habits. DBS Multiplier, however, increases interest rates based on overall transaction volume, catering to those with higher banking activity.
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