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UOB SLASHES IT’S ‘ONE ACCOUNT’ INTEREST RATES, NO MORE 7.8% FROM 1 MAY

According to an article by CNA, United Overseas Bank (UOB) has announced a revision in the interest rates for its flagship savings account, UOB One Account, which will take effect from May 1, 2024.

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This change comes in response to the long-term interest rate environment expectations, making UOB the first local bank to lower its interest rates amidst growing market expectations of potential rate cuts by the US Federal Reserve in the near future.

Interest rates offered was up to 7.8 percent for the first 100k before the announcement

The UOB One Account offers tiered interest rates that increase with the account balance, card spending, and other transactions with the bank.

In late 2022, the bank, along with its competitors, DBS and OCBC, had made aggressive hikes to the interest rates on their flagship savings accounts due to the rising rate environment. At that time, UOB offered the highest maximum interest rate of 7.8 per cent.

Now only up to 4.5 percent for the first 100k

With the latest revision, the tiered interest rates for UOB One account holders with balances up to S$100,000, who credit their salary to the bank and meet a minimum spend of S$500 a month on an eligible bank card, will range from 3 per cent to 4.5 per cent per annum.

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This is a decrease from the current 3.85 per cent to 7.8 per cent.

New rates for balances above 100k, previously only 0.05 percent

Additionally, UOB has introduced two new tiers for account holders with balances above S$100,000, who will also need to meet the same salary and spending criteria.

Interest earned on balances between S$100,000 to S$125,000 will increase to 4.5 per cent per annum from the current 0.05 per cent. Meanwhile, savings between S$125,000 and S$150,000 will earn the maximum bonus interest rate of 6 per cent a year, up from the existing 0.05 per cent.

These changes will enable UOB customers to earn up to S$6,000 total interest in a year for deposits of S$150,000 when they spend a minimum of S$500 on eligible UOB Cards and credit their salary via GIRO/PayNow each calendar month.

Waiting to see if other banks will follow suit

Currently, OCBC pays a maximum of 7.65 per cent a year for its 360 savings account, while the highest rate on DBS’ Multiplier account stands at 4.1 per cent per annum.

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No information has been provided yet regarding whether DBS and OCBC will revise their interest rates in response to UOB’s changes.

Image sources: UOB

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