SINGAPORE — The government will extend the four per cent per annum interest rate floor for all Central Provident Fund (CPF) Special, MediSave and Retirement Account monies by another year – from 1 January 2024 to 31 December 2024.
"This provides certainty for CPF members amidst the uncertain interest rate environment," the CPF Board said a statement on Thursday (21 September).
CPF interest rates for savings in Ordinary, Special and MediSave Account for the fourth quarter of 2023
Additionally, savings in the Special and MediSave Account (SMA) will earn an interest rate of 4.04 per cent from 1 October to 31 December 2023, which is an increase from the 4.01 interest rate earned in the previous quarter.
"This is due to the increase in the 12-month average yield of 10-year Singapore Government Securities (10YSGS), which the SMA interest rate is pegged to," said CPF in the statement.
This is the second interest rate increase for the SMA since the minimum interest rate of four per cent was introduced back in January 2008, while the first increase took place in the third quarter of 2023.
Meanwhile, the Ordinary Account (OA) interest rate will remain unchanged at 2.5 per cent for the fourth quarter of 2023, as the pegged OA rate remains below the floor rate of 2.5 per cent.
The concessionary interest rate for HDB housing loans, which is pegged at 0.1 per cent above the OA interest rate, will remain unchanged at 2.6 per cent for the same period.
CPF members will also continue to earn extra interest on their savings for the fourth quarter of 2023. CPF members below the age of 55 will earn an extra one per cent interest on the first S$60,000 of their combined CPF balances, capped at S$20,000 for the OA.
Members aged 55 years old and above will earn an additional two per cent interest on the first S$30,000 of their combined CPF balances and an extra one per cent on the next S$30,000, capped at S$20,000 for the OA.
No change to Retirement Account (RA) interest rate
The Retirement Account (RA) interest rate will be maintained at four per cent per annum from 1 January 2023 to 31 December 2023, as announced on 29 November 2022.
The government said that it is "watching the interest rate environment closely to ensure that the CPF interest rate pegs remain relevant in the prevailing operating environment while taking into consideration the longer-term outlook".