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Review: DBS Multiplier – Nerfed But Not Dead; No Minimum Card Spend Unlike Other Accounts

Let’s get the obvious out of the way: DBS upset a lot of people earlier this year when they made revisions (read: nerfs) to their popular savings account. Disgruntled customers were reassessing their savings strategy, and it’s likely more than a few went to other banks. Is DBS Multipler really that bad an account now?

Main changes

Previously, all one needed was to credit their salary, and spend at least a dollar on a DBS card for an easy and relatively decent interest rate on $50,000 of their savings. Accomplish another category, say investment, and your interest goes up slightly.

That’s not too bad and pretty easy to achieve. In fact, creative folks managed to come up with ways to fulfil these requirements: by buying $500 of Singapore Savings Bonds each month for 6 months, they ensured that there was a constant monthly dividend paid out which counted towards fulfiling the investment category.

Not any more, after DBS reclassified dividends to the income category insetad of investment.

Before 1st Feb 2020From 1st Feb 2020
Income + transactions in 1 category1st $50,0001st $25,000
Income + transactions in 2 categories1st $50,0001st $50,000
Income + transactions in 3 categoriesNext $50,000Next $50,000
(unchanged)

Also, you now need to hit at least 2 categories on top of income for your first $50,000 to generate higher interest. Merely qualifying for the spend category on top of your income gives higher interest only on the first $25,000 of your savings.

Fulfilling the categories

Well, what happened is now good old history, and just because something good is made worse doesn’t necessarily mean it’s now lousy. At the current climate, how does DBS Multiplier compare to its OCBC and UOB peers?

Mortgage
I may be biased – more on this later – but I think DBS Multiplier is still my account of choice. Disclosure: when I bought my condo, DBS offered competitive rates for my mortgage and hence… I get higher interest on $50,000 of savings simply by crediting my salary, spending a dollar, and paying my mortgage. I imagine DBS mortgagors like me would find DBS Multiplier really convenient.

Non-mortgagors, however, might find it a little cumbersome to have to fulfil a second category on top of spend, most probably being investment or insurance.

Investment
With dividends reclassified as income, you can only satisfy the investment category by buying stocks via DBS Vickers, or by making lump sum investments into unit trusts or doing regular investing via DBS Invest-Saver. I’ve always discouraged people from buying financial products from banks, but Vickers has pretty competitive brokerage fees for trading stocks, and investing via DBS Invest-Saver can be a pretty decent deal if you opt for passively managed index funds with 1% or less sales charge and low annual management fees.

Insurance
Again, while I dissuade people from purchasing insurance from the bank, people have discovered that buying a small, really cheap mortgage reducing term at the tune of about $10 per month or so qualifies for the insurance category, and the additional interest is worth it when your balance is high. Moreover, you get the coverage anyway, so it’s not entirely a wasted cost.

Returns and Comparisons

UOB OneOCBC 360¹DBS Multiplier²
$25,000$39.79$39.67$41.67
$50,000$84.58$96.81$83.34
$75,000$152.25$152.22
  1. OCBC 360 assumes the following criteria are met: spend + salary + step up. Do note that you can have $70,000 instead of $75,000 in OCBC 360 to achieve $152 since the max cap is $70,000 for OCBC 360.
  2. DBS Multiplier assumes: spend + salary + investment/insurance/home loan

When I compared UOB One and OCBC 360 with DBS Multiplier, I have often only included 2 categories (spend and one other), but it’s actually not that difficult to qualify for a third and reach the below interest rates:

UOB OneOCBC 360¹DBS Multiplier²
$25,000$39.79$39.67$45.63
$50,000$84.58$96.81$91.86
$75,000$152.25$152.22$141.44
$100,000$191.63
  1. OCBC 360 assumes the following criteria are met: spend + salary + step up. Do note that you can have $70,000 instead of $75,000 in OCBC 360 to achieve $152 since the max cap is $70,000 for OCBC 360.
  2. DBS Multiplier assumes: salary + spend + 2 other categories amounting to $5,000 a month

After jumping through those hoops, DBS Multiplier gives interest on a full $100,000 which neither UOB nor OCBC’s accounts can reach. This capacity is only matched by StanChart’s Bonu$aver, and I’ve explained before that losing rewards on your spend causes you to lose out on substantial amounts of value.

No minimum card spend is great

On the topic of card spend, having no minimum on the card spend is a really good feature.

Depending on your salary amount, you could reasonably hit DBS Multiplier’s $2,500 or $5,000 eligible transactions tier based on income, mortgage, investments and/or insurance. That means you don’t need to spend beyond $1 on DBS cards.

This gives you the advantage of picking another other bank’s cards if those fit into your spending habits better and/or give better rewards, even if DBS cards like Woman’s World Card and LiveFresh are pretty decent.

Spend a lot on groceries, telco bills, and dining? Maybank FnF card gives you 8% up to $1,000 of spend where DBS LiveFresh only gives 5% on $800 of spend. This is a problem OCBC 360 users would face: not being able to use a better card for the $500 of spend that they have to clock each month.

For people who are frugal, this also means not having to meet $500 of monthly spend each month.

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Conclusion

After reviewing UOB One, OCBC 360, and now DBS Multiplier, to me it’s pretty clear that these three accounts have some flaws amidst compelling features, and the suitability highly depends on your financial habits.

No proper salary? UOB One.
Willing to jump through hoops for higher returns? OCBC 360.
Home loan with DBS, and/or do not wish to spend $500 a month? DBS Mutliplier

The good:

  • No minimum amount to qualify for card spend and decent spending cards
  • High capacity of $100,000 if you can qualify for 3 categories on top of salary
  • Homeowners with mortgages with DBS qualify for one category easily
  • Higher interest if your eligible transactions go up to the next tier

The bad:

  • Having to qualify for 2 categories on top of salary crediting just to get higher interest on relatively small amount of $50,000 (compared to $70,000/$75,000)

The ugly:

  • Having to restart the investment/insurance category again after 12 months

★ ★ ★ ★ ★ ★ ★ ☆ ☆ ☆ + ★
7 + 1 Stars of Sethisfaction

The extra Star is if you have a home loan with DBS.

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