UOB One and OCBC 360 cut interest rates. What to do next?

The interests rates on savings accounts are being cut further.

Just this week, UOB announced that the interest rates on the UOB One savings account will be reduced from 1 May.

This follows an announcement last month by OCBC that the interest rates on the flagship OCBC 360 savings account will be cut from 1 May 2025.

Over the past year, we have seen interest rate cuts by the US Federal Reserve with a moderation in inflation. 

We have already seen a sharp decline in the T-bill yield, as well as fixed deposit rates in Singapore.

Let us understand more about the interest rate cuts for the OCBC 360 and UOB One accounts, and options we can explore to maximise the interest earned on our savings account.

UOB One cuts interest rates from 1 May 2025

There will be several changes to the UOB One account from 1 May 2025.

Firstly, there will be a revision of interest rates, with the maximum interest rate earned for up to S$150,000 of savings cut from 4.0% p.a. to 3.3% p.a.

The revision of interest rates on the UOB One account will apply to all new and existing UOB One accounts.

The table below summarises the revised interest earned on the UOB One account from 1 May 2025. 

For comparison purposes, the table below shows the interest rate earned on the UOB One account currently. 

As the interest rates earned on the UOB One account is tiered, we can calculate the effective interest rate earned on the UOB One account for different amount of balances we have.

The effective interest rate is the total annual interest earned as a percentage of your average balance in the UOB One account over the year.

We shared previously that the UOB One Account offers one of the highest effective interest rates of up to 4.0% per annum.

With the change on 1 May, the highest effective interest rate on the UOB One account will fall to 3.3% per annum. 

The highest effective interest rate falls to 2.3% p.a. from 3.0% p.a. for deposits of up to S$75,000.

The highest effective interest rate falls to 2.9% p.a. from 3.6% p.a. for deposits of up to S$125,000.

This means that from 1 May, you will earn up to $4,950 a year with a S$150,000 of balance in your UOB One account and by meeting and card spend of minimum $500 and credit your salary, declining from $6,000 a year previously. 

To compare the interest earned on the UOB One savings account currently and from 1 May, check out the calculator below.

To cushion the cut in interest rates on the UOB One account, UOB has introduced the UOB One Account Tax Saver promotion, where you can earn up to S$600 cash rebates when you pay your personal income or property tax via GIRO using your UOB One Account.

To qualify, you will need to maintain a monthly average balance of at least S$30,000 in your One Account.

A 6% tax payment rebate will be applied on taxes deducted between 1 April 2025 and 31 March 2026, subject to cap limits.

For example, if you have an income tax bill of S$10,000 or more per year, monthly average balance of S$150,000 in your UOB One account, you can earn tax rebate cap limit of S$50 per month or $600 per year. 

Just follow these 3 steps:

Step 1: Register your mobile number for PayNow on the UOB TMRW app

Step 2: Activate Money Lock on UOB TMRW (minimum lock-in amount: S$1)

Step 3: Apply for GIRO Monthly Tax Payment Plan on the IRAS portal and select your UOB One Account for deduction

OCBC 360 cuts interest rates from 1 May

Likewise, the interest rate on the OCBC 365 account will be cut from 1 May 2025. 

If you fulfil five categories of salary, save, spend, insure, and invest, the maximum effective interest rate earned for S$100,000 of savings will be cut from 7.65% p.a. to 6.30% p.a. 

If you only hit the more realistic three categories of salary credit, save, and spend, the maximum effective interest rate earned for S$100,000 of savings will decline from prevailing 4.65% to 3.30% 

The revision of interest rates on the OCBC 360 account will apply to all new and existing OCBC 360 accounts.

In addition, to earn an additional interest rate of 2.2% p.a. through the Grow bonus, you will need S$250,000 compared to S$200,000 currently. 

For comparison purposes, below shows the interest rate earned on the OCBC 360 account currently. 

Let’s compare the interest earned if you have S$100,000 of savings under different scenarios

To compare the interest earned on the OCBC 360 savings account currently and from 1 May, check out the calculator below.

UOB One vs OCBC 360 – Which is better?

Based on the latest rates, let’s do a comparison if you are able to meet the salary credit and card spending criteria of UOB One, as well as the Salary + Save + Spend categories of OCBC 360.

If you have S$75,000 of savings, you will earn an effective interest rate of 2.75% p.a. on the OCBC 360 account from 1 May, above the effective interest rate of 2.30% p.a. on the UOB One account. 

If you have S$100,000 of savings, you will earn an effective interest rate of 3.30% p.a. on the OCBC 360 account from 1 May, above the effective interest rate of 2.68% p.a. on the UOB One account. 

As the interest rate falls to 0.05% p.a. for deposits from S$100,000 to S$150,000 in the OCBC 360 account, you will earn an effective interest rate of 2.20% p.a. for S$150,000 of savings on the OCBC 360 account from 1 May, below the effective interest rate of 3.30% p.a. on the UOB One account. 

To compare the OCBC 360 and UOB One accounts with the new interest rates from 1 May, check out the calculator below

What are the alternatives to UOB One and OCBC 360?

Despite the cut in interest rates for the OCBC 360 and UOB One accounts, they are still the highest interest rates offered by savings accounts in Singapore if you are able to meet the salary credit criteria. 

I have seen some questions in the Beansprout community about whether it might be worthwhile switching savings accounts with the latest interest rate cuts 

The DBS Multiplier and Stanchart Bonus Saver generally offer lower interest rates compared to the new interest rates on the OCBC 360 and UOB One accounts, if you have S$100,000 of savings and meet the spending category.

If you have a home loan with DBS in addition to meeting the credit card spend requirement, and have total eligibile transactions of S$30,000 or more per month, then the effective interest rate of 3.0% p.a. you will earn will be higher than the interest rate of 2.68% p.a. on the UOB One account, but still below the 3.30% p.a. on the OCBC 360 account. 

The only other account which offers a comparable interest rate is the Bank of China SmartSaver account, which will also just announced an cut in its interest rates. From 1 May 2025, you will receive an interest rate of up to 3.25% p.a. if you are able to deposit your salary of S$2,000 and above, spend S$2,500 monthly on your credit card, and make 3 bill payments. 

Are there other options to consider to switch out of UOB One and OCBC 360 savings account?

Some have asked if it might then be worthwhile putting our money into fixed deposits or T-bills compared to the UOB One or OCBC 360 savings account. 

Firstly, we would only consider these options if we are not using these savings as emergency funds, as both fixed deposits and T-bills are less liquid compared to savings accounts. 

The best 3-month fixed deposit rate is currently at 2.50% p.a., which is lower than the effective interest rate of 3.3% p.a. offered by the OCBC 360 account and 2.68% p.a. offered by the UOB One account for S$100,000 of deposits. 

We can also consider the 6-month T-bill, which has a cut-off yield of 2.73% in the auction on 26 March.

However, the yield on the T-bill may decline again there is a recovery in applications. In the auction on 13 March, the cut-off yield fell to 2.56% as demand for the T-bill remained high despite lower yields on the T-bill.

What would Beansprout do?

While we’d have liked the attractive interest rates on the UOB One and OCBC 360 accounts to be maintained for longer, all good things must come to an end. 

Despite the cut in interest rates on the UOB One and OCBC 360 accounts, they still offer some of the highest interest rates if you have S$100,000 to S$150,0000 of savings, and are able to credit your salary and meet the card spending requirements.

By meeting these requirements, you can earn an interest rate of up to 3.3% p.a. with the OCBC 360 with S$100,000 of deposits, or with the UOB One with S$150,000 of deposits. 

Despite the cut in interest rates in the UOB One account, there are other promotions that can be tapped to optimise our savings. 

The UOB One Account Tax Saver promotion allows us to earn up to S$600 cash rebates when you pay your personal income or property tax via GIRO using your UOB One Account, while the UOB Cash is King promotions allows us to earn up to S$500 cash when we deposit fresh funds into the UOB account. 

With the interest rates for more savings accounts likely to be adjusted in the coming weeks, we will be updating our guide to the best savings accounts in Singapore regularly as they get announced. 

Follow us on Telegram to receive updates when there are revisions to the savings accounts interest rates.