SINGAPORE – GXS Bank, the digital lender backed by Grab and Singtel, has opened up its flagship savings account to new customers on a first-come, first-served basis. It also raised the deposit cap to $75,000 per account.
The account was previously only for selected Grab and Singtel customers, and each depositor could store only up to $5,000.
Rival MariBank, owned by tech giant Sea, also told The Straits Times on Wednesday that it will raise its deposit cap for individual users to $75,000 from Thursday and will be opening up to more customers in the coming weeks.
GXS’ savings account offers an interest rate of 3.48 per cent a year on “savings pockets” which customers can use to allocate funds for specific purposes, such as a holiday or home renovation.
Customers do not need to maintain a minimum balance or commit to a lock-in period, said GXS in a press statement on Wednesday.
The digital bank’s move helps to level the playing field between it and incumbent banks such as local lenders DBS, OCBC and UOB, as well as rival Trust Bank, which has a full bank licence as opposed to digital full bank.
GXS and MariBank are Singapore’s two digital full banks, which can serve retail and corporate customers. These banks were subject to a $50 million regulatory cap on retail deposits, imposed by the Monetary Authority of Singapore (MAS) during the lenders’ first two years of operation to safeguard consumers’ interests.
This meant the new entrants, which bagged their licences in December 2020, had to limit applications for their savings accounts.
Trust Bank – backed by Standard Chartered and FairPrice Group – is not subject to the cap as it holds a full bank licence and not a digital full bank licence.
The Straits Times understands that the cap has been reviewed.
An MAS spokesman said the pace of growth of a restricted digital full bank into a full-functioning digital full bank and the progressive easing of regulatory safeguards will depend on the bank’s ability to meet its licence application commitments and MAS’ supervisory expectations.
“MAS’ assessment will cover areas such as the strength of the (digital full bank’s) internal controls, compliance track record, and ability to serve their customers well,” said the spokesman.
GXS said in April that it had almost reached the $50 million limit and was working with the financial regulator to review it.
It added on Wednesday that all available savings account slots were taken up within months of the product’s launch in August 2022. All deposits will continue to be fully insured up to $75,000 per account, it said.
MariBank took in individual customers on an invite-only basis in March.
Its Mari Savings Account offers an interest rate of 2.5 per cent a year, with no minimum deposit, salary credit requirement or minimum spend amount. It also offers a business account, for which there is no cap on deposits.
“In the coming weeks, (we) will be making the MariBank experience available to more individual users and SMEs (small and medium-sized enterprises) from across the Sea ecosystem and beyond,” said the bank, whose owner Sea is behind e-commerce giant Shopee.
GXS and MariBank’s savings accounts both credit interest daily.
GXS said this allows account holders to benefit from daily interest compounding without losing out on the interest if they need to withdraw their savings.
Its latest announcement comes after it launched its first credit product – the GXS FlexiLoan – in April.
GXS said it will also launch a debit card in the coming months, offering benefits such as rewards and cashback when customers spend via their savings account.
