Time deposit also known as term deposit is money deposited in a financial institution for a specific period without making a withdrawal. So why have a term deposit when you can just open a regular savings account? Term deposits are interest-bearing bank deposits that mature at the end of the specific time frame, so in other words, it is an investment and savings account all in one.
That being said, technically it is your money and you still have the right to request a withdrawal of your time deposit amount, however, an early termination penalty will be applied if withdrawn before the agreed-upon tenure.
There are a lot of factors that go into deciding the best time deposit to go with, after considering your budget next would be the interest rates, right? The banks also took into consideration the deposit amount and duration range to devise an interest rate that might suit you, but be aware that these interest earnings are subject to a 20% withholding tax, however, some banking institutions allow tax exemptions for deposit periods of 5 years or more.
Interest earnings are credited as a lump sum at the end of the tenure but some banks also give you the option to receive your earnings on a monthly/quarterly basis. Interest rates are on per annum basis and subject to change without prior notice, contact bank for inquiries
If you are looking to make a long term investment with low risk and have passive income much higher than your regular savings account interest, then time deposits would be the way to go. Here are the top 10 banks in the Philippines where you can create a Peso time deposit account including their updated interest rates as of January 2020:
1. PBCOM (Philippines Bank of Communications):
- Short Term.
Tenure: 1month – 1year.
Minimum Deposit: Php1,000.
Interest Rate: 1.25% – 3%. - Long Term (Sure Earner Time deposit).
Tenure – 5 years.
Minimum Deposit – Php50,000.
Interest rate: Not indicated.
2. BPI (Bank of the Philippine Islands):
- Short Term (Regular, Family Savings and Direct Savings).
Tenure: 35days – 364days.
Minimum Deposit: Php50,000.
Interest Rate: 0.625% – 1.375%. - Long Term (Plan Ahead Family savings).
Tenure: 5Years.
Minimum Deposit: Php100,000.
Interest Rate: 3.58% – 4.3% (Lump Sum or monthly credit income).
3. PSBank (Philippines Savings Bank).
- Short Term.
Tenure: 30Days – 1Year
Minimum Deposit: Php10,000.
Interest rate: 0.75% – 2.5%. - Long Term.
Tenure: 5 Years.
Minimum Deposit: Php50,000.
Interest rate: 3.75%.
4. SECURITY BANK
- Short term.
Tenure: 1month – 4Years.
Minimum Deposit: Php100,000.
Interest rate: 2.1% – 3.1%. - Long Term (LTNCD – Long Term Negotiable Certificate of Deposit).
Tenure: 5Years 6 months.
Minimum Deposit: Php50,000 and increments of PHP 10,000 thereafter.
Interest rate: 4.1% (offer expires Jan 24, 2020).
5. METROBANK
- Short Term.
Tenure: 1Month – 1Year.
Minimum Deposit: Php10,000.
Interest rate: 0.25% – 1.125%. - Long term (offer expired Sept 2018).
6. MAYBANK
- Short term.
Tenure: 31Days – 359Days.
Minimum Deposit: Php25,000.
Interest rate: 0.75% – 1.5%. - Long term.
Tenure: 5Years + 1Day.
Minimum Deposit: Php50,000.
Interest rate: 3.5%.
MAYBANK offers ADDvantage Advance Time Deposit which gives earning interest of 1.75% credited upfront, a minimum deposit of Php50,000 for 1Year tenure subject to withholding tax of 20%.
7. UNION BANK
- Short Term.
Tenure: 30Days to 360Days and over.
Minimum Deposit: Php50,000.
Interest Rate: 0.625% – 1.75%. - Long Term – Not Indicated
8. EASTWEST BANK
- Short Term.
Tenure: 30Days – 360Days.
Minimum Deposit: Php10,000.
Interest Rate: 1.5% – 2.625%. - Long term.
Tenure: 2Years – 5Years + 1day.
Minimum Deposit: Php10,000.
Interest Rate: 3.125% – 3.25% (Tax Exempt Applies Only on 5years + 1 day Duration).
9. BDO (Banco De Oro).
- Short Term.
Tenure: 30Days – 360Days.
Minimum Deposit: Php1,000.
Interest Rate: 0.75% – 1.125%. - Long Term (premium Flexi Earner)
Tenure: 5Years
Minimum Deposit: Php10,000.
Interest Rate: Not indicated.
10. CHINABANK
- Short Term.
Tenure: 90Days – 360Days.
Minimum Deposit: Php5,000.
Interest Rate: 0.7% – 1.95%. - Long Term
Tenure: 5Years + 1Day.
Minimum Deposit: Php50,000.
Interest Rate: Not indicated.