Given the low-interest-rate environment globally, it was surprising that OCBC 360 account increased its salary bonus in May 2020.
It was too good to be true.
Just recently, it backtracked on its May 2020 revision and will refresh the rates again in July 2020, aligning with expectations.
It got worse.
If you are not aware of OCBC 360, it is a high yield savings account. It awards bonus interest if you perform certain transactions or fulfil specific criteria.
I covered it in detail in my previous post on May 2020 revision on the high yield savings accounts offered by the three Singaporean banks.
What Changed?
Salary bonus: bonus interests has been halved from May 2020 rates.
Spend bonus: bonus interest for this category has been removed.
| 0% | May 2020 | July 2020 |
| Salary Bonus | 1.2% for first $35,000; 2.4% for next $35,000 | 0.6% for first $35,000; 1.2% for next $35,000 |
| Spend Bonus | 0.2% for first $35,000; 0.4% for next $35,000; | 0% |
| Step-up Bonus | 0.2% for first $35,000; 0.4% for next $35,000; | Renamed as “Save” 0.2% for first $35,000; 0.4% for next $35,000; |
| Wealth Bonus | 0.6% for first $35,000; 1.2% for next $35,000 | 0.6% for first $35,000; 1.2% for next $35,000 |
| Grow Bonus | 0.8% for first $70,000 | 0.8% for first $70,000 |
The maximum effective interest rate after July 2020 is 2.15% interest p.a. compared to 3.35% interest p.a. in May 2020.
If you only credited your salary, with $70,000 of funds deposited, you will earn a maximum of 0.95% interest p.a. after July 2020 compared to 1.85% interest p.a. in May 2020.
Typically, if you managed to save $500 extra every month and have no qualifying insurance or investment products with OCBC (wealth bonus), your expected bonus interest per year is 1.25%.
My Take On the New OCBC 360
Previously, I favoured OCBC 360 over UOB One because by just crediting salary alone, your bonus interest for OCBC 360 will be more than UOB One’s maximum bonus interest.
However, it is no longer the case. Salary bonus and base interest only awards 0.95% p.a.
The save bonus (step-up) is harder to implement as it requires you to constantly monitor your monthly balances and ensure that the next month is at least $500 more. Even with the save bonus, the effective bonus only increases to 1.25% p.a.
The main push for the July revision is for more people to buy more insurance or investment products from the bank.
Conclusion
It was good while it lasted. OCBC 360 was one of the better high yielding accounts in May 2020.
The recent interest rates revision for OCBC 360 makes UOB One and DBS Multiplier more attractive.
However, it is only a matter of time before UOB and DBS will revise their rates.
So, let us wait and see.
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