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Compare and find the Best Fixed Deposit in Malaysia

Everything you want to know about fixed deposits right here. Compare for higher interest returns, greater guaranteed earnings and top promotional rates, and watch your savings grow.

Q: What is Fixed Deposit?

A Fixed Deposit or FD is a type of investment account, consistently “risk free”, that has higher interest rates when compared to regular savings account. You can expect to earn more the longer the fixed deposit stays in the bank.

Q: What is deposit amount (A) of a FD account?

The amount of initial placement in the account which is at least RM10,000 in average.

Q: How long is the tenure (t) of a FD account?

A preset period chosen for placement as short as 1 month up to 60 months.

Q: What is the interest rate (i) of a FD account?

It is calculated on yearly basis, unlike savings account which is calculated on daily basis. The longer the tenure, the higher the interest rate is given. Generally for a 12-months tenure term deposit account, the interest rate ranges approximately between 3% to 4% per annum. You might earn higher interest rate from some banks during their promotional period, normally in the beginning of a year. T&C such as certain minimum deposit amount, fresh fund and no withdrawals allowed before maturity may apply.

Q: How FD annual interest return (I) is calculated?

Based on the multiplication of deposit amount, interest rate and tenure, i.e. I = A x i x t/12. For example, if you deposit RM1,000 on interest of 3.5% p.a. for a period of 12 months, then you will earn interest return of RM35 (RM1,000 x 3.5% x 12/12) upon maturity.

Q: How to collect my investment return (A + I) upon maturity?

You can select the mode of payment upon maturity at the point of placement:

  1. Transfer to your savings or current account with the same bank

  2. Transfer to third party’s savings or current account with the same bank

  3. Cheque by mail or collect at branch

  4. Cash at branch

Q: What are the pros and cons of a FD account?

 

Advantages

Disadvantages

  • Higher interest return compared to regular savings or current account

  • Guaranteed and risk-free return upon maturity

  • Low initial principal / deposit amount

  • Illiquid investment because no flexibility to access the locked-in funds

  • Relatively low investment returns to other investment options

  • Premature withdrawal fee may apply

Q: What if I withdraw or close FD account before maturity?

Interest return that was contracted in the beginning of the FD tenure will be partially or wholly penalised / forfeited. You will have to pay early withdrawal fee when you withdraw partially or wholly from the FD account before maturity. It can be a percentage or full interest return you should gain up to the date but sometimes it may result in receiving less than initial principal. Moreover, there may be an administrative fee levied for every premature withdrawal request.

Q: Is a FD account renewable?

Your FD account will usually be automatically renewed upon maturity on the same tenure period at the prevailing interest rate or at any other rate and tenure determined by the Bank if no notifications are given at the point of placement or before date of maturity. You can even top up for higher investment returns. But unfortunately, you cannot do so before maturity.

Q: Is your invested fund protected with insurance? How much does it cover?

In the event a Deposit Insurance System (DIS) member institution’s failure of protecting the depositors’ placements, all of your insured deposits will be promptly reimbursed, up to a limit of RM250,000 per depositor per member bank (incl. principal and interest return). The protection is provided by PIDM automatically and no application is required.

Q: Who is eligible to open a FD account?

All Malaysians, PR or foreigners who aged at least 18 years old are eligible to open most of the FD accounts available in Malaysia. There are some accounts specially designed for kids (accompanied by a parent or legal guardian) or senior citizens (minimum age of 50 years) too.

Q: What are the documents required for FD account opening?

As simple as 1 2 3 - MyKad for Malaysians and passport for foreigners.

Q: How to open a FD account?

You can go to bank’s branch to open a FD account with the deposit (cash or cheque) and required documents. Alternatively, you can also opt to transfer the deposit amount from your existing savings or current account to a newly registered FD account via online banking. However, not all banks in Malaysia has such convenient facility yet.

Q: Can I set my maturity instruction at the point of placement?

Yes, you can select the following maturity instruction at point of placement, and the bank will automatically act on your instruction upon maturity of your deposit:

  1. Rollover Principal + Interest

  2. Withdraw Principal + Interest

  3. Rollover Principal + Withdraw Interest