My friend shared with me a UOB Fixed Deposit Promotion that is valid from 2nd May to 31st May 2023. Unlike previous months where I compare the interest rates of fixed deposit between banks, this post is solely on the UOB Fixed Deposit Promotion.
The reason I did not do the comparison is because I have been busy catching up on the release of financial results by REITs and sourcing for bank fixed deposit promotions takes time. I will probably do the same comparison later in the month if time permits.
Alright, back to the topic on UOB’s Fixed Deposit Promotion. From 2nd May to 31st May 2023, UOB is offering an interest rate of 3.45% per annum on your Singapore Dollar Time/Fixed Deposit. The tenor period is either 6 or 10 months and the minimum placement is S$10,000. Only fresh funds will enjoy this promotion.
If you are wondering what “Fresh Funds” mean, “Fresh Funds” means that the deposit are not funds transferred from existing UOB savings/current/fixed deposit account(s) or UOB cheques, cashier’s orders and demand drafts.
What is Fixed Deposit?
A fixed deposit is a financial instrument provided by banks or non-bank financial institutions which provides investors a higher rate of interest than a regular savings account, until the given maturity date. – Wikipedia
UOB Fixed Deposit Promotion May 2023 versus SBJUN23 GX23060E
Since the tenor period for UOB Fixed Deposit Promotion is 6 or 10 months, this is not really an apple to apple comparison with the interest rate offered by Singapore Savings Bond.
If you decided to sell SBJUN23 GX23060E after 1 year, the interest you will earn is 2.81%. UOB is offering 3.45% per annum. Thus, UOB Fixed Deposit is the clear winner here.
| Year from issue date | Interest % | Average return per year %* |
| 1 | 2.81 | 2.81 |
How much will I get for a S$10,000 placement of 10 months?
For a 10 months Time/Fixed Deposit placement of S$10,000 in fresh funds with UOB at 3.45% per annum, the interest you will get upon maturity is S$287.50. Including the principle, the total amount you will get back upon maturity is S$10,287.50.
Conclusion
With interest rates falling, the interest rate of 3.45% per annum sounds pretty attractive to me. If you have spare cash like my friend has, you can consider making your money work harder for you by doing a fixed deposit placement with UOB.