Joint Press Release by CPF Board and HDB - Minimum 4% Interest Rate For Special, MediSave And Retirement Account Monies To Be Extended Until 31 December 2019

  • Published Date: 27 Sep 2018

    CPF interest rates from 1 October 2018 to 31 December 2018

    • Up to 3.5% per annum on the Ordinary Account

    • Up to 5% per annum on the Special and MediSave accounts

    • CPF members aged 55 and above will earn an additional 1% extra interest on the first $30,000 of their combined balances

    HDB mortgage rate from 1 October 2018 to 31 December 2018

    • Remains unchanged at 2.6% per annum

     

    In view of the continuing low interest rate environment, the Government has decided to further extend the 4% floor rate for interest earned on all Special, Medisave and Retirement Account (SMRA) monies for another year until 31 December 2019.

     

    Since 1 January 2008, savings in the SMRA have been invested in Special Singapore Government Securities (SSGS) which earn an interest rate pegged to the 12-month average yield of 10-year Singapore Government Securities (10YSGS) plus 1%. This is a market-based rate for instruments of comparable risk and duration, and will ensure that members receive fair and reasonable interest rates.

     

    To help members cope with the transition, the Government had committed to providing a 4% floor rate for SMRA interest for two years up to December 2009. This was subsequently extended in light of global economic conditions and the fact that interest rates had been exceptionally low. The current 4% floor rate is due to expire on 31 December 2018.

     

    CPF interest rates for Ordinary, Special and MediSave Accounts from 1 October 2018 to 31 December 2018

     

    Central Provident Fund (CPF) members will continue to earn interest rates of up to 3.5% per annum on their Ordinary Account (OA) monies, and up to 5% per annum on their Special and MediSave accounts (SMA) monies in the last quarter of 2018. These interest rates include an extra 1% interest paid on the first $60,000 of a member’s combined balances (with up to $20,000 from the OA) which is part of the Government’s efforts to enhance the retirement savings of CPF members.

     

    CPF members aged 55 and above will also earn an additional 1% extra interest on the first $30,000 of their combined balances. This is paid over and above the current extra 1% interest that is earned on the first $60,000 of their combined balances. As a result, CPF members aged 55 and above will earn up to 6% interest per year on their retirement balances. 

     

    The extra interest received on the OA will go into the member’s Special Account (SA) or Retirement Account (RA) to enhance his or her retirement savings. If a member is above 55 years old and participates in the CPF LIFE scheme, the extra interest will still be earned on his or her combined balances, which includes the savings used for CPF LIFE.

     

    Interest rate for CPF Ordinary Account and HDB mortgage rate

     

    The OA interest rate will be maintained at 2.5% per annum from 1 October 2018 to 31 December 2018, as the computed rate of 0.32% is lower than the legislated minimum interest rate.

     

    Correspondingly, the concessionary interest rate for HDB mortgage loans, which is pegged at 0.1% above the OA interest rate, will remain unchanged at 2.6% per annum from 1 October 2018 to 31 December 2018.

     

    Please refer to Annex A for the detailed computation of the OA interest rate and HDB mortgage rate.   

     

    Interest rate for Special and MediSave accounts

     

    The SMA interest rate will be maintained at 4% per annum from 1 October 2018 to 31 December 2018, as the computed rate of 3.28% is lower than the current floor interest rate of 4% per annum.

     

    Please refer to Annex B for the detailed computation of the SMA interest rate.

     

    Interest rate for Retirement Account

     

    The RA interest rate will be maintained at 4% per annum from 1 January 2018 to 31 December 2018, as announced on 22 September 2017.

     

    Please refer to Annex C for the detailed computation of the RA interest rate.

     

    Public enquiries

     

    CPF members can visit cpf.gov.sg or call the CPF Call Centre at 1800-227-1188 for enquiries.