Guide on Fixed Deposits | Fixed Deposit Frequently Asked Questions
Bank Accounts | Fixed Depositsby Priyadarshini 16 August 2023
Fixed deposits pay you guaranteed interest on the money you deposit in a bank for a set period of time. The money in the fixed deposit will earn interest during the specified time period, and the interest will be paid out at regular intervals, usually quarterly or annually. While you can withdraw your money from a fixed deposit, if you do so before the term is up, you will earn less or no interest. In this blog, we give you a guide on fixed deposits.
The interest rate on a fixed deposit is determined by the term of the deposit. To get the best interest rate available, consider the tenure offered by the bank and whether you’re comfortable with that tenure for your fixed deposit.
Minimum deposits for promotional fixed deposit interest rates could be as high as S$10,000 or S$20,000. To take advantage of those interest rates, you must be willing to deposit that amount for that specific term.
Guide on Fixed Deposits
Can I withdraw my fixed deposit before its term expires?
Yes, you can withdraw your fixed deposit before its maturity date. You will, however, most likely lose any interest returns you have earned. Other terms and conditions may apply depending on the policies of the bank.
Can I add money to my fixed deposit account?
You cannot top up your fixed deposit, unlike a savings account. When you open a fixed deposit account, the money you deposit stays in the account until the fixed deposit term expires. If you want to put more money into a fixed deposit, you can open another fixed deposit account instead. Remember that the interest rates for the new fixed deposit account may vary depending on the bank’s current promotion.
What are the prerequisites for opening a fixed deposit account?
If you already have an account with the bank, you will need to log in to the internet banking platform to open a fixed deposit. If you do not already have an account with the bank, you may be required to open one. This would necessitate the following:
- Front and back of your NRIC (for Singaporeans / PRs)
- Passport and Employment Pass (for foreigners)
- Proof of residential address
How do I open a fixed deposit account?
You can open a fixed deposit account with any bank in Singapore. To begin earning interest on your money, you must transfer your funds into the fixed deposit account after applying. Keep in mind that promotional fixed deposit rates typically require ‘fresh funds’ deposits. This means you can’t transfer money from a savings account (with the same bank) to a fixed deposit.
In Singapore, are fixed deposits taxable?
No, interest earned on deposits with Singapore-approved banks or licensed finance companies is not taxable.
Can foreigners open fixed-income accounts in Singapore?
Yes. If you are a foreigner, you will need your passport, proof of address, and the appropriate Employment Pass/Dependent Pass/S Pass/Student Pass or Long-Term Visit Pass.
Is it possible to open a fixed deposit in foreign currency?
Yes, in addition to Singapore dollar deposits, you can place your foreign currency in fixed deposits. Many banks provide fixed deposits in popular foreign currencies such as the US dollar, the Australian dollar, the Euro, and the British pound sterling. Foreign currency deposits may even offer higher fixed deposit interest rates! Check the small print for conversion fees or auto-renewal clauses, and remember to shop around for the best promotional rate before locking in your savings.