Rising interest rates: Time to review your savings account!

Interest Rates Bank Singapore

If you haven’t heard, DBS has raised interest rates for its most popular DBS Multiplier savings accounts. The maximum interest rate one can enjoy has gone from 3.5 percent to a whopping 4.1 percent per year!

Here are the updated rates from DBS:

DBS interest rate
Source: DBS

This means up to $41 for every $1000 you leave idle in your bank account. How easy is that! With growing inflation, even the least financially-savvy person should start looking into higher-yielding deposit accounts.

If you’re still on that DBS Savings Childhood account that your parents registered you for when you were a child, it’s high time for a change. To feel motivated about making the change, check out this handy calculator from DBS which gives a projection on how much interest you may be able to earn.

Did you know that this is the second time that DBS has raised the rates this year? Things are heating up between banks, with OCBC and UOB also increasing their interest rates in recent weeks.

If you were wondering why banks are able to increase savings interest rates, the simple answer is that the U.S. central banks are raising interest rates on borrowers to curb inflation. This means that they are able to pay out and offer higher returns for those who deposit with them. As Singapore’s domestic interest rates are largely determined by global interest rates and expectations of the Singapore dollar, this is also partly why the rates are going up in Singapore.

Not that any of us are complaining. Competition between businesses is superb for consumers and this is exactly why there shouldn’t be a monopoly.

Remember how prices of eggs became inflated earlier this April due to higher production, labour, and freight costs?

It was thanks to NTUC FairPrice who led the price cut that other supermarkets follow suit. Of course, they would – if not everyone would be flocking to the NTUC FairPrice! Fortunately, NTUC FairPrice took the lead then. Otherwise, who knows how much we would be paying for eggs today?

Enough of this economics talk for now. Here’s hoping that the banks continue to raise their interest rates!