07 April 2014

OCBC 360 Account with up to 3.05% pa interest versus Standard Chartered Bonus$aver 1.88% pa

Last week, OCBC a flexible savings account known as OCBC 360. Basically this new savings account is a pretty decent one which will probably generate lots of funds and it is probably a cheaper alternative to launching a Bond for investors to fund their expansion in Hong Kong.

Anyway, back to the product itself. Currently, DBS and Citibank have similar plans where they pay you a higher interest rate on your funds. For Citibank you invest into regular savings plan or buy an insurance with them and earn up to 2.5% pa for the first 50,000. As for DBS multiplier 2.08%,you will have to consolidate Salary, Credit card spend, Home Loan instalment and Investment dividends and they will give you up to 2.08% pa for the first 50,000.

Standard Chartered's Bonus$aver 1.88% is another plan that pays well but it is only for the first 25,000. The condition to satisfy it simply spend (point of sales) or pay online to your debit or credit card of > $500 per month and your first 25,000 will earn 1.88% pa. There are no other conditions attached.

OCBC 360 is a bit similar to the Citibank and DBS plans. It also pays an interest for the first 50,000 of that account.

The three criterias each adds 1% to the base interest rate of 0.05% for first S$200,000. Earn interest of 0.15% per year on balance above S$200,000.

1. You earn 1% pa for GIRO your salary into the account
2. You earn another 1% pa if you spend more than $400 on OCBC credit cards. I have called and checked and it is confirmed that Plus! Card, Robinson Card does count towards the S$400 so long the OCBC cards tag to the same account. Spending using the principal account is counted towards the S$400. Sumplimentary card doesn't.
3. The last condition is that if you make 3 unique bill payments from this account with OCBC Online Banking using Pay Any Bill and Pay Any Card services or use GIRO, you earn another 1 more %.

I think that the OCBC 360 will definitely suck in lots of funds from other banks. With FAST transfer in place, more funds will just be transferred into the OCBC vault to take advantage of this unusually high 3.05% pa.

Most people feel that they can't spend S$400 a month. In fact, it is quite easy to acheive that. Telco bills usually adds up to almost S$70 to S$80. Groceries probably S$200 a mth. The rest can be made up of other purchases etc.

I have been using BonuSaver for a year earning that extra interest fulfilling the > S$500. I intend to switch over to OCBC and give it a try. The only trouble is to rearrange some GIRO arrangements or to manually pay some of the bills online, including the credit card bill or pay another banks credit card bill via ocbc.com online portal. That should make it count to 3 times a month.
I am sure banks like CIMB or Maybank will come out with more creative plans to grab the outgoing funds. Stay tuned. The war for SGD is beginning and will be fiercer in time to come when US raise interest rates and our mortgage rates will also rise.


OCBC 360 is definitely the winner right now if the conditions can be loosen. e.g. enable sub card holders to add up to the maincard monthly spending.  Those without credit cards (debit card users) cannot take advantage of this savings which is really a shame (SCB can). Thirdly, unemployed can't take advantage of the additional 1% as they have no salary to transfer in from.

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