OCBC 360: Change is the only constant

Jes 0 Comments

I did my previous post on how easy it was to earn some free money from OCBC 360 account. I think the folks at OCBC also realised they held a hook over us so they changed their bonus interest starting from 1st May 2015.

Really?
I know, I know, I feel disgruntled too. But after seeing how Standard Chartered Manhattan Credit card kept changing their cash rebate scheme over the years, I have kind of expected it. In sales, we call them the Discount Pricing Strategy where you hold a great promotion with bargain deals to gain reputation through word-of-mouth. It can also be considered as a type of penetration strategy to penetrate the market and drive up sales in a short time.

After some duration, they will take away some benefits but customers are stuck with your products and lazy to switch away. Let's evaluate the new bonus interests to see if there are any redeeming qualities:

Starting from the top left....

Bonus 1) The amount of money that can earn interest has increased
Old
Only $50,000 will earn the bonus interest, any amount more will only earn the base interest of 0.05%
New
Up to $60,000 ... It's good so more interest can be earned =)

Bonus 2) Credit at least 2k salary to the account
Old
1% interest
New
1.2% interest...... Yippee! The best news in this change if you satisfy this criteria =)

Bonus 3) Pay any 3 bills via giro
Old
1% interest
New
0.5% interest.... Halved my interest =(

Bonus 4) Spend at least $500 on OCBC credit cards like FRANK and OCBC365
Old
1% interest
New
0.5% interest...... Halved my good mood =(

Bonus 5) Insure or invest with OCBC New ruling
Old
None
New
Bonus is given when you buy their insurance or investment linked policies. A huge caveat is that bonus interest is paid for only 12 months, starting after the 14 days refundable period is over

Bonus 6) Increment in your account balance New ruling
Old
None
New
This bonus means that the difference in the amount of money in OCBC 360 for current month compared to last month will give you 1% interest. For example: You have 10,000 this month and 5,000 last month in your account. You earn (10,000 - 5,000) x 1% / 12 months = $4.17 earned each month

What this means for me

On Bonus 5) I do not have any investment and insurance with OCBC and am not going to start just to add $600 (60,000*1%) of bonus interest in my bank, particularly when those policies will cost more than that. If you are already planning to do so, then perfect! Otherwise, just ignore it.

On Bonus 6) Similarly, the increase in account balance is not going to benefit us that much. Those already with 60k in the account will not want to add in more money since they do not earn the other bonus interests (Bonus 1 to 4). I have thought about removing the money for one month and depositing the next just to earn the 1% but it's a horrible idea because I am sacrificing the 2.25% that could be earned for a month! Plus, the 1% interest is on the increment only, not the whole sum of money in the account.

What I will earn for Bonus 1 to 4

Old
3.05%
New
2.25% with increments earning additional 1%
The old ruling is better because I earn a flat 3.05% while the new ruling is NOT 3.25% because only the increments is earning 1% more =(
However, I can't complain since this interest rate is still better than other banks. I can also put more money in the bank (Bonus 1) and although I do not have 60k in the account yet, it means an additional $225 ((60,000 - 50,000)*2.25%) to be earned annually =)

Conclusion

It's still better than UOB One Account where the tiered bonus meant that only if you have 50k + salary in UOB or 3 giro transaction, you can get 2.43%. Any amount lower than 50k will not be better than OCBC 360.


With 6% rebates on online purchases with my FRANK card and another 3 to 6% rebates on dining with my OCBC 365, I will stick to my OCBC 360 account for the moment, thank you. 

Jes

Be thankful for what you have, when you are pursuing what you want.

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