Long queues at Singapore banks as customers lured by interest rate promotions
Long queues have reportedly started to form outside Singapore banks recently as they offer high interest rate promotions for term deposits.
Customers filled banks like United Overseas Bank (UOB) and OCBC Bank, lured by rates as high as 2.6% for 12 months.
This forced some to wait up to four hours for their turn.
Long lines in front of Toa Payoh and Bishan banks
On Friday (September 9), there was a queue of around 20 people outside UOB Bank at Toa Payoh Central, the Shin Min Daily News.
About eight to nine people lined up at banks like DBS, OCBC and Maybank in Toa Payoh and Bishan Central.
Saturday (September 10) morning the scene was similar, with Shinmin noting that signs had been erected outside UOB and OCBC in Toa Payoh.
They said they had seen more customers for questions related to account opening and term deposits.
So customers should expect longer waits and banks will stop issuing queue numbers sooner.
For UOB, that means they won’t issue tickets 2 hours before closing time.
Standby time up to 4 hours
According to Shin Min, the waiting time outside some banks has increased to four hours.
At the Central Business District (CBD), a UOB branch estimated a two-hour wait on Wednesday (September 7) due to the influx of customers, Bloomberg reported.
A woman who tried to open a checking account for her parents over lunch found 79 in front of her.
She felt that a fixed deposit was the safest place to put her money and was also tempted by the interest rates, which are also at their highest level in recent years.
UOB raises rates to 2.6%
How high are interest rates now?
UOB appears to be leading the pack, increasing rates to 2.6% for 12 months.
They also offer a 10-month fixed deposit at 2.4% in September, rising from 1.6% in August, reported NewsAsia Channel (NAC).
OCBC isn’t too far behind, with 2.3% interest on 12-month fixed deposits.
DBS, on the other hand, maintained its highest rate of 1.3%, according to Bloomberg.
RHB Bank, however, has a higher rate of 2.8% – but customers must deposit a minimum of S$20,000 for 24 months.
Hong Leong Bank is offering 2.75%, but on a deposit of at least S$50,000 for 12 months.
Maybank offers promotions for longer-term fixed deposits – 2.35% for 18 months and 2.4% for 24 months. They also have rates of 2.2% for 12 months and 2.3% for 15 months.
Standard Chartered Bank balances 1.8% for no more than 25,000 Singapore dollars in 12 months.
Term deposits are popular because savers can get a guaranteed amount of interest provided they deposit a fixed amount in a bank for a certain period of time. However, they are not allowed to withdraw the money before the end of this period.
Treasuries are a better deal: former ST correspondent
With local banks aggressively raising rates, it’s no wonder customers are flocking to banks.
Mr. Goh Eng Yeow, former senior correspondent for the Straits Times Money, was also not spared.
In a Facebook post On Friday (September 9), he said he couldn’t shop at the main UOB branch in town.
This is because they had stopped issuing queue numbers at 2:30 p.m. due to an overwhelming response to their 2.6% rate offer.
However, he said it shows that many Singaporeans were cash-rich but poor in financial literacy.
He pointed out that they could get a better return from the latest six-month Treasury bills (T-bills) offered by the government.
Treasury Bills are short-term Singapore Government Securities (SGS) issued at a discount to face value and are issued for six months and one year.
He added that many ignore it, as there is little mainstream promotion.
Shin Min, however, interviewed a cell phone store employee who felt the same way.
Yang Xiuyi, 48, said banks’ fixed deposit rates were still not attractive enough, adding that short-term government treasury bills were more profitable.
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Featured image adapted from Shin Min Daily News on Facebook.