Top Saving Rates in Malaysia in 2021

Top Saving Rates in Malaysia in 2021 – that will be the topic of this article. 

Interest rates are 0%, or slightly above average, in most parts of the world. Is Malaysia any better?

Before writing this article it has to be said that these rates might also change over time, of course.

It remains our position that in an era of 0% interest rates, and risks when it comes to currency devaluations for expats in particular, investing in a long-term manner is both safer and more profitable long-term than saving. 

If you want to invest, don’t hesitate to contact me, email (advice@adamfayed.com) or use the WhatsApp function below.

Introduction

Malaysia has long attracted people to its borders as it attracts people with its strong economic base, high standard of living, wonderful weather and friendly people. Strong sectors of the economy, good schools and livable urban infrastructure draw people in droves to land, home to the world’s tallest twin towers.

If you want to move there as a student, worker, investor or retired, you will need a bank account. Here is your guide on how to open a bank account in Malaysia.

Due to the large influx of emigrants in Malaysia, there is a policy designed to make life as easy as possible for people. For example, due to the existence of the MM2H visa program, if a foreign citizen keeps a fixed amount of money in a bank account in Malaysia, he is entitled to renew his visa. These and other relatively simple requirements make it easy to open a bank account in Malaysia.

Here are the requirements you need in general:

  • Residence permit or documents for MM2H visa (if you are an expat)
  • Employment information, such as a letter from an employer or other proof of business activity
  • Photo ID (e.g. passport)
  • The minimum deposit set by the bank depending on the type of account
  • Your fingerprint (some banks may require it for identification)

Check with the bank if you have special requirements. For example, in some cases visa requirements may be broader. One special note: if you do not have all the typical paperwork, talk to a bank manager and ask a Malaysian friend to go with him, especially if that friend has a bank account. This can make the process easier as he is considered a referral.

In Malaysia, you can open a bank account as a non-resident. You just need to provide the required documents, which, as you can see, do not require proof of address in Malaysia. If you choose a foreign bank, you can even start the process from abroad.

Opening a bank account in Malaysia should be easy with English-speaking websites and friendly, well-trained English-speaking staff. After completing the activation of your account, you will be able to leave the branch with a working basic ATM card.

It is important to read the contract as the small print can hide surprises, especially with regard to odd expenses and the like. Fees may apply for keeping accounts open, for using ATMs outside of your bank’s network, and some banks may even charge you when your balance falls below a certain amount or if you don’t use your account often enough.

In addition, it might make sense to visit international banking giants such as HSBC and Citi as they can be easier to work with and may offer simpler packages, especially if you rarely use an account.

What is a savings account in Malaysia?

Starting from this part, is for people, investors, residents, non-residents, who want to open a savings account in Malaysia, and are looking for best savings rates. 

Keeping money at home is convenient, for sure, but not as profitable as keeping money in a savings account.

A savings account is designed not only to keep your money safe, but to grow it as well, as banks will pay interest or make a profit on top of your savings. A savings account is a financial product offered by a bank to store your money and receive interest. It also gives you the ability to carry out day to day transactions and withdraw funds whenever you like.

In Malaysia, when you deposit cash into a savings account, PIDM insures it at the federal level for up to RM 250,000. So if the bank goes bankrupt, your hard-earned money will be protected.

In exchange for the money you put in your savings account, the bank will offer you a refund in the form of interest or a rate of return.

Often the interest rate on a savings account is much lower than on a fixed deposit due to the fact that it is a safe account, that is, where you keep the amount of money in custody at the bank.

A savings account can also come with a passbook for savers to record and track their transactions. The interest you accrued will also be recorded in your passbook.

For savings accounts that don’t include passbooks, you can always track your expenses and interest income with a paper or paperless bank statement.

That’s not all, a savings account allows you to access your money through the following services:

  • OTC transactions
  • ATMs using a debit card
  • Interbank transfers GIRO
  • Internet banking for paying bills 

Here we are to present you some of the highest savings rates out there in Malaysian banks:

  • Standard Chartered Privilege$aver – up to 4.75%
  • RHB Smart Account/-i – up to 2.85%
  • UOB Stash Account – up to 2.30%
  • Hong Leong Bank Pay&Save Account – up to 2.25%
  • OCBC 360 Account – up to 2.15%
  • UOB One Account – up to 2.15%
  • RHB Bonus Saver – up to 1.50%

Let’s now review them, find out more about each account and the rest is up to you, which one you’ll choose and how much you’ll benefit from it.

Standard Chartered Privilege$aver

The Standard Chartered Privilege $aver savings account currently offers the highest interest rate on a savings account, provided the account holder meets certain conditions. 

To increase the interest rate from the base 0.05% per annum, three conditions must be met (save, spend and invest) as of February 1, 2021. 

First, you need to deposit at least RM 3,000 in fresh funds every month to receive an additional 0.9% per year interest through the Save requirement. 

Plus, you can earn up to 1.8% per year interest on meeting the expense requirement: 0.9% per annum on a minimum charge of RM 1,000 on a Standard Chartered credit card, and an additional 0.9% per annum on a minimum of five retail debit card transactions. 

Finally, unlock another 2% per annum for up to three months if you qualify for the investment requirement. You can do this by investing at least RM 30,000 in a mutual fund or by purchasing an insurance policy with a minimum annual premium of RM 30,000.

Also note that the average Standard Chartered Privilege account has a limit on the amount of interest that can be earned through the three bonus categories. For each category, bonus interest will be credited up to RM 100,000 of your monthly average balance (MAB). 

For the Expense category, both credit and debit card expenses are allocated to a separate MAB limit of RM 100,000.

At 4.75% per annum, you will receive a good percentage of interest every month. A good way to meet the conservation requirement for 0.9% per annum. It is interesting to use this account as a payroll deposit account – you just need to report it to the HR department. 

It’s also easy to spend money using StanChart credit and debit cards. For credit cards in particular, JustOne Platinum and Liverpool FC Cashback credit cards bring cashback as you spend, so you can accumulate quite a lot of money every month!

For some additional context, this latest earnings structure for the Privilege $aver campaign was an update that was released in early February 2021, allowing you to potentially earn more interest than before. 

RHB Smart Account/-i

The RHB Smart Account works very much like the Standard Chartered Privilege $aver, in that you will need to complete three transactions (save, pay and spend) to increase the interest rate from the base 0.05% per annum up to 2.85% per annum.

In the “Save” category you can get a bonus of 1.80% per annum when you deposit RM 2,000 of fresh funds into your smart account every month. 

After that, you can earn 0.5% per annum in the Pay category when you pay at least three bills online or through the RHB mobile banking app. Finally, get another 0.5% per annum through the Expenses category by spending a minimum of RM 1,000 on retail purchases using an RHB credit or debit card. Overall, this gives you a nice 2.85% profit per year interest.

In fact, there is still 1.0% per annum interest that you can earn by investing a minimum of RM 1,000 in eligible RHB financial products (Invest category). 

These include products such as non-EPF investments, private retirement plans (PRS), and mutual funds. If you do carry out this transaction, you will receive 3.85% per annum.

Please note, however, that bonus interest earned in the Save, Pay and Spend categories will only apply to your account balance of up to RM 100,000 1.0% per annum On the other hand, interest earned under the “Invest” category is calculated as a fixed rate on the investment amount.

UOB Stash Account

UOB Stash is a simpler savings account that offers bonus interest when you maintain or increase your account balance each month, increasing its overall interest rate up from the base rate of 0.05% per year. 

The highest rate is 2.30% per year, the percentage level is unlocked when the total balance of your account exceeds 100,000 ringgit.

However, please note that UOB Stash stops offering bonus interest when your account balance exceeds RM 200,000, you will only receive a 1.60% higher base rate per year. 

As a result, the best UOB Stash rate is 2.30% per annum and applies only if your account balance is between RM 100,000 and RM 200,000. If your account balance exceeds RM 200,000, the effective interest rate (EIR) will begin to decline. 

For example, if you have 250,000 ringgit in your account, you only earn 2.16% EIR per year instead of 2.30% per annum, it is applicable for account balances from 100,000 to 200,000 ringgit.

Meanwhile, those looking to deposit between RM 50,000 and RM 100,000 can switch to a UOB InvestPro account instead. UOB InvestPro, formerly known as UOB e-invoice, offers a higher rate of 1.70% per annum for account balances in this range (compared to the lower return on UOB Stash from 0.55% to 1.55% per year).

The UOB InvestPro account also offers a fee exemption for individual transactions. You will be able to get an exemption from the fees for GIRO interbank transactions performed through online banking. Additionally, if you maintain your account balance of RM 5,000 each month, you can receive up to four MEPS withdrawal fee waivers. 

Hong Leong Bank Pay & Save Account

Hong Leong Bank Pay & Save is another savings account that requires you to complete certain steps on a monthly basis in order to receive interest. 

However, while Standard Chartered Privilege $aver, RHB Smart Account and OCBC 360 do offer a minimum base rate, Pay & Save interest rates are entirely dependent on three steps involved.

Pay & Save offers a savings rate of 1.25% per annum, if you deposit 2,000 ringgit monthly into your account in one amount, 0.50% per annum e-Xtra interest rate of at least RM 500 on eligible payments and 0.50% per annum. 

Debit card interest if you spend at least RM500 on retail transactions using your Hong Leong debit card.

In fact, an extra step can bring you up to 0.90% more per year interest, but this only applies if you are trading stocks 0.90% per annum. The level is available if you trade more than 100,000 ringgit per month. Otherwise, you will receive bonus interest ranging from 0.30% to 0.70% per year through stock trading.

If you are considering creating a Pay & Save account, make sure you read the terms in advance. For example, you may only be eligible for interest on savings if you deposit RM 2,000 for three consecutive months. 

Moreover, the interest on e-Xtra and debit card is capped at RM 30 per month, so you will reach this interest limit if your account balance is around RM 71,990 and above. Similar to the conditions set by Privilege $aver and OCBC 360, there are also limits on interest income on balances above RM 100,000.

OCBC 360 Account

Like Standard Chartered Privilege $aver and RHB Smart Account, OCBC 360 account offers bonus interest when performing certain transactions with its OCBC online bank account and OCBC credit or debit cards. 

The base interest rate is also set at 0.05% per annum, but three additional transactions (Deposit, Payment and Expenses) bring bonus interest of 0.70% per annum, each offers up to 2.15% per annum in total.

First, you just need to deposit at least RM 500 monthly into your OCBC 360 account to earn 0.70% per annum bonus interest. 

Additionally 0.70% per annum will be issued if you pay at least three bills with OCBC Online Banking within a month. This includes credit card bills, loans and JomPay account payments! 

Finally, another 0.70% per annum. Interest is earned when you spend at least RM500 on your OCBC credit or debit card, resulting in a total interest of 2.15% per annum. this month.

If you look at the conditions, then reaching 2.15% per annum is not so difficult interest. The inclusion of JomPay bill payment makes it easy to complete the three required transactions. 

You can also get extra cashback for this RM500 credit / debit card with OCBC 365 credit card, which offers 1% cashback on the first RM1,000 charged. Just note that multiple invoice payments per meter within one month will count as one transaction for your OCBC 360 account. In addition, the 2.15% per annum interest rate applies only to the first RM100,000 on your balance.

OCBC also offers a Sharia-compliant option with the same benefits, known as OCBC Al-Amin 360, with a similar rate of return.

UOB One Account

UOB also has a Single Account which allows you to earn up to 2.15% per year. percent if you want to take additional steps to receive bonus interest that increases the base rate from 0.10% per annum.

Maximum interest rate 2.15% per annum. unlocked if your account has a balance between 50,000 and 100,000 ringgit and you perform two selected transactions. First, you need to spend at least RM500 monthly using your UOB debit or credit card. 

Secondly, you can pay three bills online (minimum RM 50 per account) or deposit a minimum of RM 2000 into your account per transaction every month.

Meanwhile, if your account balance is less than RM 50,000, you can earn no more than 1.65% per year by conducting the two specified transactions.

Interestingly, the UOB One account stops offering bonus interest when your account balance exceeds RM 100,000, although its base rate increases from 0.10% per year up to 1.65% per annum. 

The effective interest rate that you can earn when reaching this range of the account balance also decreases; for example, if your balance is RM 125,000, you will only receive an effective interest rate of 2.05% per annum (compared to 2.15% per annum if your balance is between RM 50,000 and RM 100,000).

RHB Bonus Saver

This savings account rewards those who save money regularly every month. The RHB Bonus Saver program requires you to maintain a monthly additional balance of RM 500 every month for 12 consecutive months to gradually unlock. The base interest rate of 1.40% per annum after that.

In other words, you will need to increase your average monthly balance by at least RM 500 every month for 12 months to unlock 1.40% per annum interest.

For starters, the account will start at a base rate of 0.2% per year, but you will also receive bonus interest for each month that you can maintain the required additional balance. Even better, this bonus percentage will gradually increase if you can maintain the required balance for 12 months.

For example, you will receive an overall rate of 0.30% per year (which is base rate 0.20% + bonus rate 0.10%) for the first month, and if you can keep it in the second month, then your total interest rate will be increased to 0.40% per annum (base rate 0.20% + bonus rate 0.20%). 

This continues until you hit 1.40% in the 12th month and if you still have a monthly additional balance of RM 500 every month after the first 12 months, you will earn an additional 0.10% per year interest for 1.50% per annum total.

The RHB Bonus Saver account did offer a better return of 2.75% per year before the cut in the overnight interest rate (OPR) in May 2020 from 1.50% per annum. 

However, it is still a good choice for those still building up their funds, compared to UOB InvestPro and Stash accounts or Alliance SavePlus account – all of which reward those who deposit large sums of money.

To sum up 

Saving money in the bank is a losing game in an era of 0% interest rates, but keeping some in cash for emergencies and cash flow makes sense.

For investors who moved to Malaysia, the best way to double their money is to open a savings account with high rates of course.

All the savings accounts listed above are PIDM insured for up to RM 250,000, which means that in the event of a bank failure, your savings account with that bank is insured and can be claimed up to RM 250,000.

As you can see all the listed savings account options are competitive so the choice will be also enough difficult to make. More details about the accounts are available on their official websites, but we hope this short information will help you quickly orientate and pick one bank for further cooperation.

Pained by financial indecision? Want to invest with Adam?

Financial Planner - Adam Fayed

Adam is an internationally recognised author on financial matters, with over 230 million answers views on Quora.com and a widely sold book on Amazon

Further Reading

In the article below, taken from my Quora answers, I speak about:

  • Is there any 100% risk-free investment available?
  • Will the stock market skyrocket after Covid ends, as most people think, or could we have a surprise in store?
  • What is the most scientific approach to making a profit in the stock market?
  • Why do Mainland Chinese investors prefer to invest in real estate over stocks, or is it more complicated than that? I speak about my experience in the local market.

To read more click below:

Related Blogs