That was fast – not one month after dramatically increasing the savings limit from a paltry S$5,000 to S$75,000, GXS is decreasing the interest rate of their savings account’s Saving Pockets from 3.48% p.a. to 2.68% p.a. This will take effect on 17th August 2023.
A significant drop in rates, I think this renders the account quite uncompetitive.
“We’ve heard from many of you…”
In the email sent out by GXS earlier today, the digital bank puts this change as a – you guessed it – revision. Rates are going up in the Main Account! Instead of offering 0.08% p.a, money in the Main Account now gets 2.38% p.a.
Those who are familiar with GXS Savings Account would know that this division between the Main Account and Savings Pockets is pretty much nonsensical. Virtually every user would place all their funds into Savings Pockets for the higher interest rate, so the increase in rates for the ironically named Main Account has negligible impact to the attractiveness of the savings account as a whole.
29 days later
Counting from 19th July 2023 (date of the increase in savings limit) to 17th August 2023 when the new rate will take effect, the GXS Savings Account was really quite compelling for a grand total of 29 days. Was this a calculated move to garner publicity, user interest and deposits before adjusting the rate to something more palatable to business interests, or did GXS simply underestimate the demand? Who knows?
Either way, I don’t think it inspires a lot of confidence in the digital bank. To their credit, they did give notice… of around 10 days. Based on my observation, local, more traditional banks tend to announce rate changes a month or so in advance, so 10 days seem a little short.
Nevertheless, some notice is better than no notice, and it leaves us some time to look for alternatives and shift our funds if we wish. It was certainly fun getting some S$7 every day for a month… give or take a couple of days.
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I’m assume that people who have been using GXS Savings Account are those who either do not want to meet conditions of accounts like OCBC 360 or UOB One, or are placing funds in excess of those accounts’ caps.
Such people would probably want other fuss-free accounts, and already, there are names being thrown up in the group chat – UOB Stash, StanChart e$aver, and CIMB FastSaver promo are pretty viable alternatives.
I’ll do a little bit of digging around to see what alternatives there are before putting up a post on that, so stay subscribed if you want such updates.
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