Should I Choose DBS Multiplier Or Stanchart Bonus Saver With Credit Cards Considered!

With Stanchart, DBS and OCBC being afffected by the Covid-19 and with all the changes in bank interest rates, it is hard to decide which account to go for?

This article will help you answer the burning question of “Should I Choose DBS Multiplier Or stanchart Bonus Saver?” and other question that you might need help with.

DBS Multiplier Account

Eligibility and fees of the DBS multiplier account:​​​​​

• No initial deposit is required
• No monthly account fees charged
• No minimum average daily balance required if this is your first DBS account.
• If your average daily balance falls below S$3,000 (based on total SGD equivalent of SGD & foreign currency balances), a Fall-below fee of S$5 will be charged. This fee is waived up until 29 years old.
• If the account is closed within 6 months, Early closure fees are S$30.

Revision of Interest Rates for DBS Multiplier from 1 August 2020

How does the DBS multiplier account work?

To earn a viable percentage of interest, you’ll need to first fulfil the income category by crediting your salary and/or dividends crediting.

And, transact in at least one of the following categories below, credit card spent, home loan instalments, insurance or investments.

This is part of the new revisions that have been enforced since 1st February 2020.

To watch your money multiply significantly, your total eligible transactions would need to add up to S$2,000 or more.

There’s no minimum transaction amount required for each category. You just need to meet the total eligible transaction amounts.

According to the revised interest rate table, if you have an account balance of $1,000 which stays throughout the year, crediting your salary after CPF of $2,000 plus $500 spend on a credit card will get you an interest of 0.90% which is $9 per year.

Personally, Earning $9 per year is definitely not worth it!! looking forward, other banks interest rates are also going to cut! 

Therefore, i would rather use the money to invest even thought the risk is higher but it is still much better than putting in a bank that earns less than 1% interest!

Did you Know that DBS Has A Balance cap?

As you can see above DBS has a balance cap for bonus interest rates, to make it easier to understand, let’s assume you have $100,000 and you credit a salary of $2,500 and $500 on your credit card. Now that makes $3,000 total transactions which put you in band two earning you 1.60% interest on your first $25,000.

But wait what happens to the other $75,000? Do I get a higher interest?

Yes & No!!

You won’t get higher interest if you only transact in one category which means that the remaining $75,000 will only get 0.05% interest.

The only way for you to increase your interest is to fulfill another category, for example, investing through DBS invest-saver. 

To get to the last band, you will have to you transact across three or four categories each month!

Best Credit cards to pair with DBS Multiplier

Stanchart BonusSaver Account

This account is very different from DBS Multiplier or even other savings account which their interest rates vary depending on your account balance.

However, with the Stanchart BonusSaver Account, you can earn up to 3.88% on your first $100,000!!

To be eligible to open the account and debit card, you will have to be 18 years of age.

To apply for the Credit Card, you will have to be 21 years of age.

Eligibility and fees of the Stanchart BonusSaver Account

• No initial deposit is required
• Minimum Average Monthly Balance of $3,000, a Fall-below fee of S$5 will be charged
• No monthly account fee charged
• Early account closure fee of $30

Revision of Interest Rates for Stanchart BonusSaver from 1 July 2020

How Does ​the Stanchart BonusSaver work?

Some of you might be asking, "wow so many changes? Should i still continue?"

Well, let's break it down so we really understand.

For credit spending, if you spend between $500 to $2,000 you earn an interest rate of 0.30%, spend more than $2,000, you will get an interest rate of 0.80%.

Credit your salary of $3,000 or more you can earn an interest rate of 0.40%.

Make 3 eligible bill payments of at least S$50 each (in a calendar month) will earn you 0.10%.

Personally, since I am a fresh graduate, I won’t be able to earn the interest rate o for invest/insure as it requires Investing through their Eligible Unit Trust with a minimum subscription sum of S$30,000. 

Or purchase an Eligible Insurance Policy with a minimal annual premium of S$12,000.

If I was to open the Stanchart BonusSaver account, the highest interest rate I can achieve by spending more than $2,000 on a credit card, crediting $3,000 salary and making 3 bill payments worth $50 would be 0.80% + 0.40% + 0.10% = 1.30%!!!

Now that is very Low!! 

But with the covid-19 pandemic happening around, there is no way to avoid lowering bank interest rates.

Best Credit Card to pair with Stanchart BonusSaver

Did you know about this!!!

SCB has chosen to restrict its customers to spending only on BonusSaver Cards, instead of picking from their other credit card choices.

It does not have any perks except it just to help the consumer achieve the 0.50% or 1.50% interest rate

This means you cannot pair it with the Standard Chartered Unlimited Cashback Card, which is among the bank's top credit cards as it gives you 1.5% unlimited cash back.

*Simple Hack*

I got a tip from one of our community friends is that if you are watching out not to spend too much on your credit card, you can consider spending via debit card to hit the spending limits!!

To get the Same Perks!!

Scenarios and which account!

Scenario 1: Fresh Graduate Degree with a salary of $3,750 with $10,000 Account balance.

Let’s start with DBS Multiplier Account

If you are a fresh graduate with a salary of $3,750, your take-home pay after CPF contribution will be $3,000

Assume you credit your salary and spend at least $500 on your credit card (Salary Credit + Transactions in 1 category).

Your total eligible transaction is $3,500 and your total interest earned is 0.90%

Compare it with Stanchart BonusSaver Account

Assume you credit your salary and spend at least $500 on your credit card (transaction in 1 category)

Your total interest will be 0.40% (salary credit) + 0.3% (credit spend) = 0.70%

DBS Multiplier wins this round!!!

But what happens when you spend more than $2,000 on your credit card?

With DBS Multiplier, your total eligible transaction is $5,000. Your total interest rate will be 1.10%.

Which gives you $10,000 X 1.10% = $110 interest per year!!!

Compare it with Stanchart Bonus Saver, by spending more than $2,000 on your credit card, your total interest will be 0.40%% (salary credit) + 0.80% (credit spend) = 1.20%

Which gives you $120 interest per year!!!

Verdict: Stanchart BonusSaver depends a lot more on credit card spending, so if you are a big spender then Stanchart BonusSaver is for you.

Word of Caution!!!!

With the Recent changes of interest rate, it is getting increasingly hard to find out with bank is really suitable!!

Scenario 2: Young newlywed with $5,000 pay and non-working/stay home spouse with $50,000 account balance

Stanchart has also revised their interest rate based on account balance to $80,000

Let’s start with DBS Multiplier Account

Assuming you earn a salary of $5,000, your take-home salary will be $4,000.

Assume you credit your salary, spend at least $1,800 on your credit card and invest $200 (transaction in 2 categories).

Your total eligible transaction is $7,000 and with your account balance of $50,000, your total interest rate is 1.80% p.a.

Compare it with Stanchart BonusSaver Account

If you credit your salary, spend $2,000 on your credit card and make 3 eligible bill payments of at least S$50 each (in a calendar month).

Your total interest rate earned is 1.30% p.a.

You know who is the obvious winner here!!!

Conclusion and my personal choice

After a detailed analysis, It is getting really hard to figure out which banks interest rate are really good but i will still be sticking to DBS Multiplier account.

But if you are a fresh graduate like me starting, the DBS Multiplier is the best account because we won’t be spending at least $2000 on our credit card!!!

Just by crediting your salary and transacting in one other category will give you that 0.70%-0.90%.

So, for anyone out there who is a fresh graduate just starting out, not spending crazy amounts on your credit card!!

I will stick with DBS Multiplier Account!!