Singaporeans banking with UOB may want to reassess their savings strategy. Come 1 September 2025, the popular UOB One Account will see its maximum effective interest rate slashed from 3.3% p.a. to 2.5% p.a., despite maintaining the same account balance cap of S$150,000. This marks the second rate reduction in under a year, disappointing many, especially those optimising both air miles and interest returns.
Unlike other “hurdle accounts” that require users to take up insurance, investments, or home loans to unlock higher interest tiers, the UOB One Account has been a go-to for simplicity. Customers merely had to credit a salary of S$1,600 or more and spend S$500 monthly on eligible UOB cards, such as the UOB Lady’s Card or Lady’s Solitaire Card — favourites among miles collectors.
But with this upcoming rate cut, even loyalty from long-time customers is being tested.
New Rates, Same Conditions — But Is It Still Worth It?
From September, the revised interest tiers are as follows:
- 1.5% p.a. for the first S$75K (down from 2.3%)
- 3.0% p.a. for the next S$50K (down from 3.8%)
- 4.5% p.a. for the last S$25K (down from 5.3%)
- Above S$150K earns only 0.05%
This results in a maximum effective interest of just 2.5%, compared to the current 3.3%. For those who opt for GIRO debits instead of salary credit, the rate falls even further to 1.4% p.a. on S$125,000.
Though the structure remains intact — minimum card spend, salary credit, and eligible cards unchanged — the appeal has weakened. For those chasing high interest while accumulating credit card rewards or air miles, this move narrows the gap between UOB and its competitors.
Still the Best for Miles Collectors?
Despite the downgrade, UOB One remains competitive in Singapore’s lukewarm interest rate environment. Other options like BOC SmartSaver (2.55%), OCBC 360 (2.45%), and DBS Multiplier (up to 2.2%) offer slightly lower yields and often come with more complicated requirements. The CPF Ordinary Account’s 2.5% interest, once seen as unremarkable, now stands shoulder to shoulder with UOB’s latest offering — without needing to jump through hoops.
That said, the UOB One Account + UOB Lady’s Card combo still offers decent mileage earn rates alongside the savings interest — a key reason many are hesitant to jump ship. But some users may now look to split funds between UOB and other banks, or even shift focus toward fixed deposits, which currently offer attractive returns with fewer strings attached.
Don’t Forget the 6% Tax Rebate Promo
UOB is still dangling a small carrot — the ongoing 6% rebate on GIRO income tax payments. Customers who meet the minimum balance and have PayNow registered, activated Money Lock, and linked their UOB One Account for GIRO deduction can receive monthly rebates of up to S$50, depending on average balances.
For those with S$150K in the account and annual tax bills of around S$10,000, this translates into an effective additional yield of about 0.4% p.a. — a modest but appreciated cushion amidst falling rates.
Time to Reassess Your Strategy?
The latest reduction by UOB signals a broader trend: the golden era of 3–5% savings accounts may be behind us, at least for now. With interest rates declining globally, banks are scaling back bonus interest payouts, and customers are left evaluating if the perks justify the loyalty.
For now, UOB One remains a practical choice for miles chasers due to its compatibility with rewards-focused spending, but with diminishing returns, savvy savers may want to diversify their banking strategy.
Whether you stick with UOB or start eyeing other banks, one thing is clear — financial planning in Singapore’s banking landscape just got a bit more complicated.