Best FD Rates in Malaysia – Earn up to 3.90% for one year

What is a Fixed Deposit (FD)

Before you search for the best FD rates in Malaysia, first a quick summary of what a FD is. A FD is a type of savings or investment account that guarantees a rate of interest for a fixed period offered by all banks in Malaysia. Unlike most regular savings accounts that calculates interest on a daily basis, no interest is paid to you if you decide to withdraw or uplift just one sen of your money before the end of the FD period, the maturity date . This means a smart saver will only enter into FDs when they are able to put cash aside for the entire period.

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Fixed Deposit (FD) vs. Instant access savings (Savings Accounts)

FDNormal instant access savings
+ Generally higher rate of interest+ Easy access to your savings
+ Guaranteed interest rate+ Interest calculated daily
+ Easy calculations for your return+ Generally lower minimum amount to open
- Less flexible/liquidity- Lower rate of interest

You might think putting your money in a normal savings account means you will get high rates of interest. But let’s take a real life example of the extra money you could be saving with higher FD rates over the savings account from the same banking institution, CIMB Bank with a amount of RM25,000.

CIMBInstant Access SavingsFixed DepositExtra RM straight into your pocket!
Interest Rate0.10%3.00%
1 MonthRM2.08RM62.50RM60.42
Interest Rate0.10%3.05%
3 MonthsRM6.25RM187.97RM181.72
Interest rate0.10%3.15%
12 MonthsRM25RM798.97RM773.97
The interest rate can vary depending on the length of time you what to keep your money locked up. Normally, the longer the FD time period, the higher the interest rate the banks will offer as represented by the table above. Rates effective as of 23/01/2014.

Why do banks offer higher rates on FD?

It is also very important to know that the longer you fix for, the more you are risking the fact that an unpredicatable future means this could be a bad choice. If interest rates were to increase rapidly, you would’ve lost the flexibility to change and switch to a better FD account without losing the interest that you had earned so far. That is one of the reasons why banks can give you higher interest rates than most savings accounts because you are taking this ‘time risk.’ Furthermore banks don’t pay interest if you withdraw any funds earlier than your selected maturity. This means you have more of an incentive to keep your money with them until the end of the period, thus holding your cash for longer over basic savings accounts!

 

Do you depend on savings interest as your income source?

When using fixed rate savings, you won’t usually get paid monthly interest. Therefore many who rely on interest earned from savings as an income stream don’t use FDs, even though they’re paying higher FD rates. Yet there’s a way to work around this easily.

Here’s an example: Ali has RM100,000, and can get 4% in a 12-month FD and only 1% in an instant access savings account. He would like about RM4,000 of interest from these savings to add to his income for spending. To do this, he should put RM96,000 in the FD, and RM4,000 in the instant access savings. Then spend the instant access money over the year, knowing the RM3,840 interest earned in the fixed account will make up for it. He’ll effectively get the high rate and be spending the interest.

This way you can grab the high FD rate accounts, but retain access to enough cash in the meantime. Remember though, if you might need to get at the whole lump within the fixed term, this trick won’t help and FDs may not be for you.

Is my money safe in Fixed Deposits?

During the 2008 financial crisis, global banks around the world starting collapsing and since then, people started to question the security of their savings. The possibility of local and foreign banks in Malaysia remaining in business forever is not guaranteed and thus your savings could be at risk should a bank fail. So is your money safe?

The golden rule to saving is to ensure you put your cash into a Malaysia regulated bank that is protected under the Perbadanan Insurans Deposit Malaysia (PIDM) membership scheme. PIDM protects your bank deposits and will promptly reimburse you on your insured deposits should a member bank fail and there is no charge for this insurance protection.  Keep an eye out for the logo at your banking institution (image below).

Savings of up to RM 250,000 is guaranteed by the PIDM per institution so if you have less than than, you don’t have too much to worry about. If you have more to save, you can get protection on your entire savings by dividing your savings into several FD accounts/bank institutions.

Example: you had RM1,000,000 and didn’t want to take any risk, you could open 4 separate FDs in 4 separate banks.

Another way to protect your savings is to open joint accounts because they also enjoy separate deposit insurance under the PIDM scheme. You could place RM250,000 into your own FD but also open a joint FD accounts with your father, mother spouse etc. That way, you can enjoy high FD rates on large balances without worrying too much about the limit.

What you are effectively doing is spreading the risk over many banks and thus not putting all your eggs into one basket. Click here for a list of all PIDM member institutions.

See the full Are My Savings Safe in a Bank Article.

The Best 1-Month FD Rates – up to 3.20% p.a.

Keeping money in a 1-month FD is a simple way to increase your interest income without having to sacrifice too much short term requirement of funds. By managing your monthly incomings and outgoings you can organise a different 1-month FD every month and still have access to your funds when you need it on one day each month.

Bank Rakyat Deposits Account-i – Highest 1-month FD rate at 3.20% p.a.
Drawback: no explict guarantee from PIDM, only Ministry of Finance implicit guarantee

Interest Rate: 3.20% p.a
Minimum Deposit: 
RM 5,000
Minimum Age Requirement: 
18 yrs
Tenure: 1-month
Features: - Bank Rakyat Deposits Account-i
1. Profit rate is paid higher than normal Savings Account
2. Deposit of more than RM5,000, profit is paid monthly
3. Automatic renewal
4. Deposit Certificates may be used as collateral for other Syariah-compliant financing

Calculated Interest:

Bank Rakyat Akaun Deposit-i Makeen3.6% p.a.
Deposit Amount3-month interest
RM500 RM4.44
RM20,000 RM177.62
RM50,000 RM444.05
 
Go to Bank Raykat
Bank Rakyat’s Deposits Account-i is the market leader at 3.20% p.a, outfoxing it’s nearest competitors by a significant margin (most other banks hover around the 2.90%-3.00% rate to Affin Bank’s 3.06% p.a.) However, our main concern is with their PIDM status. As Bank Rakyat is a Cooperative Bank, they are not covered under this explicit guarantee. As such, you will only get implicit protection from the Ministry of Finance under the Development of Financial Institution Act (DAFIA).

 

Affin Islamic Bank General Investment Account-i – 1-month rate at 3.06% p.a
Drawback: limited branches in Malaysia, minimum deposit of RM5,000 

Interest Rate: 3.06% p.a
Minimum Deposit: 
RM 5,000
Minimum Age Requirement: 
18 yrs
Tenure: 1-month
Features:
1. Flexible period of investment from 1 month to 60 months and allow you to make partial withdrawals.
2.Automatic renewal upon maturity.
3.Profit earned can be automatically credited into your Current Account and Saving Account.

Calculated Interest:

Affin Islamic GIA3.06% p.a.
Deposit Amount1-month interest
RM1,000 RM2.51
RM20,000 RM50.30
RM50,000 RM125.75
Go to Affin Islamic Bank
Affin Islamic Bank’s rate of 3.06% p.a is market leading among the more established banks in the industry, but only marginally. Most large banks in Malaysia offer between 2.90%-3.00% for 1-month FDs.

 

 The Best 1-month FD rate for Senior Citizens

Public Bank Golden 50 PLUS Fixed Deposit Account-highest 1-month among major banks at 3.1% p.a.
Drawback: minimum age of 50 yrs, minimum deposit of RM30,000 

Interest rate: 3.1% p.a
Minimum Deposit:
 RM30,000
Minimum Age Requirement: 
 50 yrs
Tenure: 1-month
Features:
1. Optional overdraft facility of up to 100% margin at attractive rates.
2. No introducer is required if you wish to open a current account.
3. Waiver of service charge for current account.
4. Special discounts applicable to accountholders aged 50 years and above:
- 50% discount on commission for purchase of Travellers’ Cheques.
- 50% discount on rental and renewal of a safe deposit box for 2 years, where available.
- 50% discount when making a Will or creating a Trust with PB Trustee Services Berhad.
- 1/8% off the Bank’s prevailing selling rates for purchase of foreign currency notes.
- Discounts on the following insurance products with Lonpac Insurance Berhad:-
TypeDiscount Rate
Householders Insurance15%
Traveller Personal Accident Insurance25%
Golfers Insurance25%

5.

Placement OptionsOption 1Option 2
Tenure1 to 12 months15, 18, 21, 24, 36, 48 & 60 months
Interest Rate0.1% p.a. above the prevailing PLUS Fixed Deposit interest rates for the respective tenures
0.1% p.a. above the prevailing 15 months PLUS Fixed Deposit interest rates
Interest Payment MethodCredited into customer's savings or current account maintained with the Bank upon maturity,
OR
Add to the principal upon maturity
Credited into customer's savings or current account maintained with the Bank on a monthly basis

Calculated Interest:
PB Golden 50 PLUS FD3.10% p.a.
Deposit Amount1-month interest
RM30,000 RM76.42
RM60,000 RM152.84
RM250,000 RM636.83

Eligible for protection by PIDM

 
Go to Public Bank
Public Bank’s Golden 50 PLUS Fixed Deposit Account is market leading among the more established banks, but only by a slim margin. Most large banks in Malaysia offer 2.90%-3.00% p.a for a 1-month tenure. Senior citizens (50 yrs or older) who are willing to deposit RM30,000 of their money can enjoy leading market rates, along with a slew of other benefits, which in our opinon, make it a very attractive package.


The Best 3-Month FD rates -  up to 3.60% p.a

Bank Rakyat Deposits Account-i – Competitive 3-month FD rate at 3.60% p.a.
Drawback: no explict guarantee from PIDM, only Ministry of Finance implicit guarantee

Interest Rate: 3.60% p.a
Minimum Deposit: 
RM 500
Minimum Age Requirement: 
18 yrs
Tenure: 3-month
Features: - Bank Rakyat Akaun Deposit-i Makeen
1. Profit rate is paid higher than normal Savings Account
2. Deposit of more than RM5,000, profit is paid monthly
3. Automatic renewal
4. Deposit Certificates may be used as collateral for other Syariah-compliant financing

Calculated Interest:

Bank Rakyat Akaun Deposit-i Makeen3.6% p.a.
Deposit Amount3-month interest
RM500 RM4.44
RM20,000 RM177.62
RM50,000 RM444.05
 
Go to Bank Raykat
Bank Rakyat’s Deposits Account-i is a market leader at 3.60% p.a. However, our main concern is with their PIDM status. As Bank Rakyat is a Cooperative Bank, they are not covered under this explicit guarantee. As such, you will only get implicit protection from the Ministry of Finance under the Development of Financial Institution Act (DAFIA).


The Best 6-Month FD rates – up to 3.65% p.a.

Bank Rakyat Deposits Account-i (Fixed Deposit)- top 6-month rate at 3.65% p.a
Drawback: no explicit guarantee from PIDM, only Ministry of Finance implicit guarantee

Interest Rate: 3.65% p.a
Minimum Deposit: 
RM 500
Minimum Age Requirement: 18 yrs
Tenure: 6-month
Features: Bank Rakyat Deposits Account-i
1. Profit rate is paid higher than normal Savings Account
2. Deposit of more than RM5,000, profit is paid monthly
3. Automatic renewal
4. Deposit Certificates may be used as collateral for other Syariah-compliant financing

 

Calculated Interest:
 

Bank Rakyat 6-month3.65% p.a.
Deposit Amount6-month interest
RM500RM4.50
RM20,000 RM180.05
RM50,000 RM450.13
Go to Bank Rakyat
Bank Rakyat’s Deposits Account-i is the market leader here with 3.65% p.a. Our main concern is with their PIDM status. As Bank Rakyat is a Cooperative Bank, they are not covered under this explicit guarantee, and you will only get implicit protection from the Ministry of Finance under the Development of Financial Institution Act (DAFIA).

 

Affin Islamic Bank General Investment Account-i – competitive 6-month rate of 3.26% p.a., good if you don’t want Bank Rakyat
Drawback: limited branches in Malaysia

Interest Rate: 3.26% p.a
Minimum Deposit: 
RM 500
Minimum Age Requirement: 
18 yrs
Tenure: 6-month
Features:
1. Flexible period of investment from 1 month to 60 months and allow you to make partial withdrawals.
2.Automatic renewal upon maturity.
3.Profit earned can be automatically credited into your Current Account and Saving Account.

Calculated Interest:

Affin/Affin Islamic 6-month3.26% p.a.
Deposit Amount6-month interest
RM500RM9.04
RM20,000 RM361.73
RM50,000 RM904.32
Go to Affin Islamic Bank

 The Best 9-month FD rates – up to 3.75% p.a

Bank Rakyat Deposits Account-i (Fixed Deposit)- top 9-month rate at 3.75% p.a
Drawback: no explicit guarantee from PIDM, only Ministry of Finance implicit guarantee

Interest Rate: 3.75% p.a
Minimum Deposit: 
RM 500
Minimum Age Requirement: 18 yrs
Tenure: 9-month
Features: Bank Rakyat Deposits Account-i
1. Profit rate is paid higher than normal Savings Account
2. Deposit of more than RM5,000, profit is paid monthly
3. Automatic renewal
4. Deposit Certificates may be used as collateral for other Syariah-compliant financing

 

Calculated Interest:
Bank Rakyat 9-month3.75% p.a.
Deposit Amount9-month interest
RM500RM14.00
RM20,000 RM559.90
RM50,000 RM1,399.76
Go to Bank Rakyat
Once again, Bank Rakyat’sDeposits Account-i is the market leader here with 3.75% p.a. Our main concern is with their PIDM status. As Bank Rakyat is a Cooperative Bank, they are not covered under this explicit guarantee, and you will only get implicit protection from the Ministry of Finance under the Development of Financial Institution Act (DAFIA).


The Best 12-Month FD rates –  up to 3.90 % p.a

Bank Rakyat Deposits Account-i – highest 12-month rate at 3.90% p.a
Drawback: no explicit guarantee from PIDM, only Ministry of Finance implicit guarantee

Interest Rate: 3.90% p.a
Minimum Deposit: 
RM 500
Minimum Age Requirement: 18 yrs
Tenure: 12-month
Features: Bank Rakyat Deposits Account-i
1. Profit rate is paid higher than normal Savings Account
2. Deposit of more than RM5,000, profit is paid monthly
3. Automatic renewal
4. Deposit Certificates may be used as collateral for other Syariah-compliant financing

 

Calculated Interest:

Bank Rakyat 12-month3.9% p.a.
Deposit Amount12 months interest
RM500 RM19.50
RM20,000 RM780.00
RM50,000 RM1,950.00
Go to Bank Rakyat
No surprises here, Bank Rakyat’s Deposits Account-i is the market leader with 3.90% p.a. However, once again, our main concern is with their PIDM status. As Bank Rakyat is a Cooperative Bank, they are not covered under this explicit guarantee, and you will only get implicit protection from the Ministry of Finance under the Development of Financial Institution Act (DAFIA).

 

Affin Islamic Bank General Investment Account-i – competitive 12-month rate of 3.61% p.a., good if you don’t want Bank Rakyat
Drawback: limited branches in Malaysia

Interest Rate: 3.61% p.a
Minimum Deposit: 
RM 500
Minimum Age Requirement: 
18 yrs
Tenure: 12-month
Features:
1. Flexible period of investment from 1 month to 60 months and allow you to make partial withdrawals.
2.Automatic renewal upon maturity.
3.Profit earned can be automatically credited into your Current Account and Saving Account.

Calculated Interest:

Affin Bank/Affin Islamic Bank 12-month General Investment Account-i3.61% p.a.
Deposit Amount12 months interest
RM500 RM18.05
RM20,000 RM722.00
RM50,000 RM1,805.00

Go to Affin Islamic Bank

Some additional points for the high flyers out there:

If you are a preferred or priority bank customer, you may receive higher rate than what’s advertised online or in branch. Furthermore, having a long standing relationship with a Bank also can give you more leverage over interest rate negotiations. Banks like to keep their existing preferred/premier customers happy and having a good history with your Relationship Manager can also give you more power in your discussions with them.

Final SaveMoney FD Rates tips

  1. Although rates are published, always ask to speak to someone in the bank to negotiate the interest rate (the higher the amount saved, the more leverage you have to grab a better deal!)
  2. Spread your savings of up to RM 250,000 per FDaccount to keep it extra safe.
  3. Keep scouting around for the highest FD rates (or keep checking us out!).
  4. And finally, start saving NOW. It’s never too early to start saving money!

Beware of the Dog

Only enter into an FD if you don’t need the whole lump sum within the fixed term. Look out for FDs that charges a penalty or fine for withdrawing money out before the end of the period, not just waiving the interest. Some FDs are not auto renewable which means going into the branch is the only way to extend your saving period.

There you go, thanks for reading our “Best FD Rates in Malaysia” article!

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