t bills

Singapore T Bills: The Complete Know-How Guide

Singapore T-bills, also called treasury bills, are government-issued debt securities. Treasury bills are safe in principal amounts, and the default risk by the Singapore government is close to zero. You can include the investment in your investment portfolio to diversify stock market risks and increase interest income from the security. The latest yields of t-bills in Singapore (as of Feb 28, 2023):

Types of T-bills

Yields p.a.




What are Treasury Bills?

Treasury bills(t-bills) are short-term debt the Singapore government issues to fill time gaps between project funding and tax or other revenue collections. T-bills are of the shortest duration among the other 2 government debts: the Singapore Government Securities SGS and Singapore Savings Bonds.

The Singapore treasury bills have 2 maturities: 6 months and 1 year, and sell for a discount off the face values. Investors get paid the face value on maturity. For example, a 6-month treasury bill with a face value of $1,000 can sell for $980 on the issue. On the bill expiry date, you get paid $1,000 in return.

The $20 you receive at the end of the investment period is a one-off fixed-interest payment from investing in the t-bill.

How secure are the Singapore treasury bills? One indicator references a country’s financial strength, called sovereign financial rating. Before issuing the securities, the government will thoroughly examine its financial health and strength by rating agencies like Standard & Poor’s, Moody’s, or Fitch.

The government will issue any subsequent debt to investors based on factors including assessment and decisions by these international rating agencies. The Singapore government has the highest rating of AAA and Aaa by these 3 international agencies, so the securities it issues have the strongest backup by assets and commitment by the authority. 

The Summary:

  • The Monetary Authority of Singapore is responsible for issuing treasury bills.
  • Treasury bills are debt issued by the Singapore government to fund projects.
  • T-bills have 2 durations of 6 months and 12 months.
  • Treasury bills with the highest ratings of Aaa and AAA have the most robust financial backup and commitment from the Singapore government.
  • The difference between purchase and redemption prices is the return an investor gets from investing in a treasury bill.


How do Treasury Bills Compare to Other Securities by the Singapore Government?

Besides treasury bills, the Singapore government also issues other 2 debt securities to investors. The following illustrates the main differences between the 3 securities, so you have a concept of the features of these 3 investments:


Savings bonds

SGS bonds


6 months, 1 year Up to 10 years 2, 5, 10, 15, 20, 30, & 50 years

Minimum investment amounts in S$

$1,000 and in multiples of $1,000 $500 and in multiples of $500 $1,000 and in multiples of $1,000

Maximum investment amounts in S$

None, but up to the allotment limits for auctions Up to $200,000 Up to the allotment limits for auctions

Interest payment methods

Issued at a discount from the face or par value Fixed coupons, and in an annual step-up way Fixed coupons

Interest payment frequency

At maturity Every 6 months since the issue Every 6 months since the issue


Yes No


About redemptions At maturity only(t-bills pay a face or par value)
  • Monthly redemption allowed with no penalty
  • The face value and accrued interest to be redeemed

At maturity only

Method of issue Uniform price auction: competitive and non-competitive bids Quantity ceiling format
  • Uniform price auction: non-competitive and competitive bids
  • Public offer: prices and yields stated on placement tranche, the MAS distributes based on the investor number maximization and application distribution
Secondary market trades Through DBS, POSB, OCBC, and UOB branches N/A
  • Through DBS, POSB, OCBC, and UOB branches
  • Through the Singapore Stock Exchange(SGX)
Financing sources SRS, CPF SRS only

Auction only

Frequency of issue Fortnightly or quarterly Monthly, for at least 5 years
  • Auction: monthly
  • Syndication: announced by the MAS


Issuance of Treasury Bills

The Monetary Authority of Singapore(MAS) sells treasury bills through a uniform price auction. A uniform price auction is the highest yield(also called cut-off yield) accepted by the MAS to allocate securities to the most competitive bids at an auction.

A treasury bill auction offers 2 types of bids: competitive and non-competitive.

1. Competitive bid

A competitive bid is a yield offer an investor is willing to accept in investing in a treasury bill. By submitting a yield offer to the MAS, an investor specifies a yield or above at which he is willing to buy the t-bills. The yield offered is in percentage format, up to 2 decimal points.

The lower a yield bid offer is, the more competitive that bid becomes. Besides, investors may not obtain the full investment he requires as it is up to the MAS’s discretion, including comparing a bid with other cut-off yields.

2. Non-competitive bid

Contrary to competitive bids, a non-competitive bid requires an investment amount only from an investor, regardless of required yields or returns.

The MAS allots 40% of a total t-bill issue amount to non-competitive bid investors and fills up the remaining non-competitive bids on a pro-rata basis if any. Any outstanding balance after this type of investor goes to competitive bids by distributing the amounts from the lowest to the highest yields.

Besides buying directly from the Monetary Authority of Singapore, you can also invest in treasury bills listed on the Singapore Stock Exchange(SGX.) 4 authorized banks: DBS/POSB, OCBC, and UOB facilitate t-bill investments in their branches across the country.

businessman counting his cash envelope

Current State of Treasury Bills

Like other market securities, t-bill prices vary continuously with factors around. Of these, domestic and major international interest rate policies like the US profoundly impact a treasury bill’s value. When interest rates rise, fixed-income securities like bonds and treasury bills will fall in price. Therefore, the MAS lifts the yields on issues of t-bills, and investors demand lower prices for listed debt securities in the current market due to rising interest rates.

At a Glance: Sharp Increases in Treasury Bill Yields in the Past Year

Treasury Bill Yields

Time Period


6-month T-bills

March 2022 to March 2023 More than 5-fold increase, from 0.78% to 3.98%

1-year T-bills

Apr 2022 to Jan 2023 Nearly 2-fold increase, from 2% to 3.87%
Federal fund rates March 2022 to March 2023

Increased 20-fold, from 0.45% to 4.75%

T-bill rates March, 2022 to March 2023

Peaked at 3.98% from the low of 0.78% for 6-month bills and 3.87% from 2% for 1-year bills


The past year has seen sharp increases in the cut-off yields of treasury bills from March 22 to March 2023. The yields of the new issues for 6-month t-bills have risen from 0.78% a year earlier to 3.98% for the most recent auction, a more than 5-fold increase. 

The yields for the new issue of 1-year t-bills starting on Apr 13, 2022, have increased from 2% to 3.87% on Jan 26, 2023, a nearly 2-fold rise. The US interest rate policy has affected global sovereign interest rate trends. 

The US Federal Reserve, the central bank, has increased interest rates eight times over the past year to curb inflation. The interest rate rose substantially from 0.45% on March 2022 to 4.75% on March 2023, a 20-fold increase for the past year. It is no wonder the t-bill yields have increased to a large extent. However, the benefits belong to investors because the return increases.The yield curve has always been a bumpy one. The t-bill rates peaked on the new issue of Dec 8, 2022, and began a bumpy road to the latest 3.98% this March. Like other bond prices, the prices for treasury bills, regardless of the primary or secondary market, are lower when interest rates rise, and the opposite is true for decreasing yields.

Risks and Benefits of Investing in Treasury Bills

Similar to other investment tools, the pros and cons of treasury bills are the primary considerations if you invest in t-bills. The risks and benefits below cover everything you must contemplate upon buying the investment.


  • Inflation: Treasury bills offer low yields among fixed-income securities. You may suffer from losing the absolute value of money if the return from your investments, like t-bills, cannot outrun inflation. The annual Singapore inflation rate in January 2023 is 6.5%, while the 6-month treasury bills return 3.98% p.a. to investors. You may risk losing 2.52% of capital eaten by rising prices.
  • Investment risk: Though deemed a safe investment, the return from investing in t-bills lags behind other investing tools, even a local bank deposit. HSBC offers an annual 4% for a 7-month fixed deposit, which returns more to an annual 3.98% return from a treasury bill. A conservative investor may find it a hard sell to invest in a t-bill.
  • Redemption: T bills/treasury bills are short-term investments for up to 12 months. You lose interest if you redeem your bills before maturity. A treasury bill will not give you a proportional interest before the expiry, though it does not impose the penalty.


  • Low minimum investment amount: Unlike corporate bonds, treasury bills have a low entry investment of a minimum of S$1,000, so more investors can afford to participate. Besides, the low face value enhances market liquidity reflecting the instant real value and making securities more marketable.
  • Default-free guarantee: With its AAA credit rating, treasury bills have full backup from the Singapore authority. The default risk is minimum to none. 
  • Diversifying market risks: Investors can include a portion of t-bills in their investment portfolios to reduce downside risks from the market turmoil due to their low price fluctuations.
  • Tax exemption: Individual investors can claim tax exemption from the interest income from investing in treasury bills.
  • Multiple investing channels: You can use funds in the CPF investment account or SRS to buy t-bills besides cash. With a bank account with any of DBS, POSB, OCBC, and UOB, you can trade the security at ATMs nationwide.

business responsibility investing in company

Case Study

Before Buying T-Billing

An example: you are interested in purchasing treasury bills for the next 6 months. Before investing, you need one or more of the following:

  • You are 18 or over, not undischarged bankrupt, and have undergone financial testing by banks.
  • A bank account: You need an account with one of the local banks in Singapore: DBS, POSB, OCBC, or UOB.
  • A central deposit account(CDP): A CDP account is required to link up with your bank account and facilitate your t-bills if you purchase through a stock exchange.
  • An SRS account: An SRS account is part of Singapore’s local public retirement system. You can use it to invest in treasury bills.
  • A CPF account: Like SRS, it is a retirement account in the government system. Comprising 2 types of accounts: CPFIS-OA and CPFIS-SA, the CPF accounts can invest in treasury bills. Only the 4 banks in Singapore, such as DBS, POSB, OCBC, and UOB, provide CPF account services.

Investing in Treasury Bills

Buying t-bills is never more convenient than others, as various options are available to investors. The options below explain the details:

1. Cash

You can submit your application through an ATM and internet account with the 4 banks mentioned above. Besides, you should make sure your bank account for investment should link up with a CDP account for facilitating security services. Banks may charge a transaction fee of $2, except for DBS.

2. SRS

An internet banking account of SRS with one of the 4 banks in Singapore to begin trading t-bills.

3. CPFIS-OA and SA

Like SRS, you need a CPF investment account with one of the 4 banks to invest in treasury bills.

4. Bid for t-bills

During the application process, you should decide how to buy from 2 options: competitive and non-competitive bids. 

Some tips may help you understand your chance of success if you opt for a competitive bid:

  • If your proposed cut-off yield is lower than the one approved by the MAS, you are highly successful in getting the full bid, which means you get a full amount applied.
  • If your proposal equals the yield announced by the MAS, you may not get the full amount you applied for.
  • If your proposed cut-off yield is higher than the one approved by the MAS, your chance of getting a bid is more likely unsuccessful.

5. Buying listed treasury bills

Besides purchasing from the MAS, you can buy from the Singapore Stock Exchange. T-bills are securities issued by the MAS and have not yet expired, offering investors another investment venue other than the primary market. All you do is have a bank account with any of the 4 banks and a CPD linked-up account and begin to trade.

6. How to sell t-bills

As t-bills are redeemable only at maturity, you can only cash in the bills before expiry by selling them through the stock exchange. Most likely, you cannot redeem the full amount due to the expiry reason and pricing fluctuations in the market. However, it offers a place you can sell them for cash conveniently if you are satisfied with a t-bill price quote.

A Competitive or Non-Competitive Bid, Which is Better?

A non-competitive bid offers a better chance to individual investors for 2 reasons. The first is the MAS allocates the first 40% of t-bills to non-competitive bid holders, so the applicants have a greater chance of success. 

Secondly, a competitive bid applicant may not defeat others as numerous rivals compete for market investments. Occasionally, you may get a successful competitive bid but at a meager cut-off yield.

Should You Invest in Treasury Bills?

Before investing, you may be a fit for throwing money into treasury bills if you possess one of the following features.:

  • You are risk averse and unwilling to take more risks like equity trading or other high-risk activities.
  • You like predictable and stable returns, for example, bonds or bills providing regular income.
  • You diversify your investments by including stable, though low-return t-bills into your portfolio to reduce risks.

Read Also: How to Invest 10k in Singapore and Type of Taxes


Singapore T-bills offer investors low-risk investment choices for guaranteed capital and return. Besides, they act as a safe fund parking venue for aggressive investors to avoid excess risk and earn a reasonable income.

Key takeaways

  • Singapore t-bills are a low-risk investment, guaranteed by the government.
  • Treasury bills offer predictable and stable returns to investors.
  • Active investors can include t-bills to diversify investment portfolio risks.
  • T-bills are available on the primary market – the MAS, and the secondary market – the Singapore Stock Exchange.

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