Fixed Deposit Rates in Malaysia [Updated on Nov 2024] – Versa

Everything You Need to Know About Fixed Deposits:

What are Fixed Deposits?

A Fixed Deposit (FD) is a popular investment option in Malaysia, allowing individuals to deposit a specific amount of money for a predetermined period in exchange for a higher interest rate than a regular savings account. This financial product is highly sought after due to its guaranteed returns and stability, making it an attractive choice for both seasoned and beginner investors looking to grow their savings securely.

In Malaysia, fixed deposit accounts are offered by various banks, each providing competitive FD rates, tailored options, and unique features to cater to different financial needs and goals, helping you identify the best FD rate in Malaysia.

How Do Fixed Deposits Work?

A fixed deposit in Malaysia works by requiring individuals to lock in their money for a specific tenure, during which they earn interest at a predetermined rate, known as the FD interest rate.

This fixed tenure, typically ranging from a month to several years, is a key factor as it determines when the investor like yourself will receive their principal amount back alongside the accrued interest.

At the end of this period, known as the maturity date, the investment matures, thus finally allowing you to withdraw your funds or reinvest them. Interest is calculated based on the principal amount and the chosen interest rate, often compounded monthly, which means that the earnings grow over time.

Difference Between Savings and Fixed Deposit Accounts

Savings Accounts and Fixed Deposit (FD) Accounts are like siblings! Both are popular options for saving money, but they do have their key differences. These differences mainly lie in their flexibility, interest rates, and risk.

Here’s a quick table to summarise their key differences:

FeatureSaving AccountFixed Deposits Account
FlexibilityHighLow
Interest RatesLowHigher
RisksLowLow

What Are the Benefits of Investing in a Fixed Deposit?

Let’s get into the perks of fixed deposits! Investing in a fixed deposit offers numerous advantages, making it one of the most popular savings options in Malaysia; among these benefits are guaranteed returns, low-risk investment opportunities, and inviting fixed deposit interest rates that often surpass those of regular savings accounts.

1. Guaranteed Returns

2. Low-Risk Investment

3. Flexible Tenure Options

4. Higher Interest Rates

What Are the Different Types of Fixed Deposits in Malaysia?

In Malaysia, investors can choose from various types of fixed deposits, primarily categorised into conventional fixed deposits and Islamic fixed deposits, each catering to different financial needs and principles.

Conventional fixed deposits are the most common type in Malaysia, offering competitive interest rates and straightforward investment terms. This makes them accessible to a wide range of investors who are looking for stability in their financial planning.

These deposits typically feature various tenure options, which can range from a few months to several years, allowing investors to choose what best fits their financial goals.

  • Interest rates on fixed deposits can vary significantly, influenced by factors such as the economic environment, central bank policies, and the bank’s own lending rates.
  • Higher deposit amounts might unlock better interest rates, enabling savvy investors to maximise returns.
  • While fixed deposits are generally low-risk, it’s important to consider that funds are usually locked in for the agreed tenure. When funds are withdrawn prior to the agreed tenur, penalty fees will be incurred.

To gauge potential earnings accurately, you can use an FD calculator Malaysia, which provides a clear breakdown of expected returns based on different deposit amounts and durations.

Looking for a Shariah-compliant option? Islamic fixed deposits are designed to comply with Shariah law, offering profit-sharing mechanisms instead of conventional interest, making them attractive to Muslim investors seeking ethical investment options.

This innovative approach ensures that the investments align with your religious beliefs, fundamentally differing from traditional banking models. In these agreements, your funds are invested to fund ethical ventures, enabling you and the other party to share in the profits.

  • Profit-sharing: Instead of earning fixed interest, returns are based on the actual profits generated by the investment.
  • Risk-sharing: Investors and banks share both profits and risks, creating an especially collaborative atmosphere.

These practices not only enhance the appeal of Shariah-compliant investment choices but also foster a deeper sense of financial responsibility and community welfare among investors.

What Factors Affect the Fixed Deposit Rates in Malaysia?

Various factors can influence fixed deposit interest in Malaysia, including economic conditions, inflation rates, and banking policies, all of which play a significant role in determining the FD rate Malaysia offered by different banks.

1. Economic Conditions and FD Rate Malaysia

2. Inflation Rates and FD Interest Rate Malaysia

3. Banking Policies and Fixed Deposit Interest in Malaysia

How to Choose the Best Fixed Deposit Rate in Malaysia?

Choosing the best fixed deposit rate in Malaysia involves several key steps, including comparing interest rates, considering tenure options, and checking for promotions that banks may offer to attract customers. To find the best FD in Malaysia or the best fixed deposit account Malaysia has to offer, you do need to do your homework as it does take a bit of research and effort.

1. Compare Interest Rates and Use FD Calculator Malaysia

2. Consider the Tenure Options for Fixed Deposit Malaysia

3. Check for Promotions and Bonuses

Fixed Deposit Rate of Major Banks in Malaysia

FIXED DEPOSITSFD RATES
PER ANNUM
DEPOSIT PERIODMINIMUM DEPOSITDEPOSITOR’S INSURANCE
AFFIN Bank2.00% – 2.35%1 – 60 monthsRM500PIDM
Alliance Bank2.25% – 2.80%1 – 60 monthsRM500PIDM
Ambank1.95% – 2.60%1 – 60 monthsRM500PIDM
Bank Rakyat2.50% – 2.80%1 – 60 monthsRM500Malaysian Government
CIMB Bank2.30% – 2.60%1 – 60 monthsRM1,000PIDM
Hong Leong Bank2.15% – 2.35%1 – 60 monthsRM500PIDM
HSBC2.45% – 2.70%1 – 60 monthsRM1,000PIDM
Maybank2.30% – 2.60%1 – 60 monthsRM1,000PIDM
OCBC2.40% – 2.70%1 – 60 monthsRM1,000PIDM
Public Bank2.10% – 2.50%1 – 60 monthsRM1,000PIDM
RHB Bank2.30% – 2.50%1 – 60 monthsRM500PIDM
UOB Bank2.40% – 2.70%1 – 12 monthsRM500PIDM

What Are the Risks of Investing in a Fixed Deposit Malaysia?

We’ll be real with you. While fixed deposits in Malaysia are generally considered safe investments, they are not without risks; key concerns include low liquidity and the potential loss of purchasing power over time due to inflation.

1. Low Liquidity

2. Potential Loss of Purchasing Power

How to Open a Fixed Deposit Account in Malaysia?

Opening a fixed deposit account in Malaysia is a straightforward process that involves selecting a bank, determining your investment amount and tenure, and completing the necessary documentation. Utilising an FD calculator in Malaysia can help you determine potential returns.

To start, you should compare various banks to find the best interest rates and terms suitable for their financial goals. Each financial institution may offer different perks, so consider examining factors such as:

  • Interest rates – Look for competitive rates that maximise your returns.
  • Minimum deposit requirements – Check how much you need to start.
  • Tenure options – Ensure they provide flexibility according to your plans.
  • Penalties for early withdrawal – Understanding these can save you money.

Next, gather required documentation, such as identification, proof of income, and residence. This preparation will facilitate a smooth account setup and ensure compliance with bank policies. Always read the terms and conditions carefully before signing.

By following these steps, you can confidently choose the best fixed deposit account in Malaysia, setting the stage for a secure future. Remember to compare the best fixed deposit rate Malaysia offers to ensure optimal returns. You got this!

Alternatives to Fixed Deposits

😔 Do FD tenures worry you? What if you need to make an early withdrawal due to an emergency? Want to start growing your savings even before having RM1,000 in hand?

🤩 We have an alternative! What if we told you that Versa Save offers:

  • Minimum cash-in amount of only RM10!
    Yes, we believe that sedikit-sedikit jadi bukit, start saving from as low as RM10
  • No tenures or lock-in periods
    Yes, withdraw anytime and keep your gained interest!
  • Better-than-FD interest rates
    Versa Save has 2 accounts available: Versa Cash (conventional) and Versa Cash-i (Shariah-compliant). Interest rates are 3.65%* p.a. nett and 3.39%* p.a. nett respectively.

In a nutshell: 

Product🏆 Versa Save 🏆Fixed DepositsSavings Accounts
Interest rates3.65%* p.a. nett

P.S.: Earn higher interest rates with Versa Quests!
1.0 – 3.0% p.a.** 0 – 2% p.a.
Minimum placementRM10RM500 – 1,000RM10
Early withdrawalYesNo Yes

* Versa Save’s base nett return for September 2024

According to The World Bank, Malaysia’s inflation rate for 2024 is expected to be 2.5%**, so it would be in your best interest to ensure your hard-earned money beats inflation 😉

If Versa Save sounds good to you, yay! Create your Versa account online in our app so you can have your money work as hard as you.

Here’s a quick guide on how to get started with Versa Save:

  1. Download the Versa app from our official page here.
  2. Create your Versa account and complete your onboarding as instructed in the app.
  3. Select either of these Versa Save funds to make your first cash-in:
    1. Versa Cash (conventional) or 
    2. Versa Cash-i (Shariah-compliant)
  4. Wait for your cash-in to be successfully processed, and congratulations, your account is successfully activated!🥳 

** Sources: Hong Leong Bank fixed deposit, Affin Bank fixed deposit; Bank Rakyat fixed deposit; CIMB Bank fixed deposit; Maybank fixed deposit; OCBC fixed deposit; Public Bank fixed deposit; RHB Bank fixed deposit; Alliance Bank fixed deposit; Ambank fixed deposit

Frequently Asked Questions

1. What is a fixed deposit rate in Malaysia?

2. How is the fixed deposit rate in Malaysia determined?

3. What is the minimum deposit amount for a fixed deposit account in Malaysia?

4. Can I withdraw my money from a fixed deposit account before the maturity date?

5. Are fixed deposit rates in Malaysia guaranteed?

6. Can I open a fixed deposit account as a non-resident in Malaysia?

7. Is a fixed deposit worth it in Malaysia?

8. Is a fixed deposit safe?

9. Can I withdraw FD anytime?

10. What is the disadvantage of FD?

11. What happens to fixed deposits if a bank fails?

12. Is FD a good investment?

13. Which is better: FD or gold?

Should you have any questions, please do not hesitate to reach out to us here. 💬