What to Do with Pocket Money... Savings and Deposit Products Gain Attention as Interest Rates Rise

On the 25th, as the Bank of Korea raised the base interest rate from 0.75% to 1.0% per annum, commercial banks began increasing interest rates on savings and time deposits. The photo shows a notice related to savings and time deposits posted on the exterior wall of a bank in downtown Seoul on the same day. Photo by Moon Honam munonam@

[Asia Economy Reporter Yu Je-hoon] Recently, as the domestic stock market has fallen into a slump due to the impact of interest rate hikes, an increasing number of financial consumers are turning their attention to savings and deposit products.

According to the Financial Supervisory Service's integrated financial product comparison disclosure on the 29th, products with an annual interest rate exceeding 2% are increasingly appearing among one-year fixed deposit products at domestic commercial banks.

K Bank's 'CodeK Fixed Deposit' offers a pre-tax interest rate of 2.10%. Additionally, the Industrial Bank of Korea's 'KDB Dream Fixed Deposit' is at 2.05%, Gwangju Bank's 'Smart Moa Dream Fixed Deposit' and Busan Bank's 'Naemamdaero Deposit' both offer 2.00%.

Other products include Kakao Bank's 'Kakao Bank Fixed Deposit (1.90%)', Daegu Bank's 'IM Smart Deposit (1.85%)', Gyeongnam Bank's 'BNK Main Transaction Preferential Fixed Deposit (1.80%)', and Shinhan Bank's 'Future Planning Crevasse Pension Deposit (1.75%)'. Some products allow for interest rates between 2.00% and 2.30% if specific preferential conditions are met.

Savings banks' fixed deposit interest rates have risen to the high 2% range. As of this day, HB Savings Bank's Smart Revolving Fixed Deposit and e-Revolving Fixed Deposit show the highest rate at 2.80%, Dongwon Jeil Savings Bank's 'Revolving Fixed Deposit - Non-face-to-face (Variable Rate)' is at 2.75%, and Daehan Savings Bank's fixed deposit (Internet banking) product offers a pre-tax interest rate of 2.72%.

Among commercial banks, installment savings products with interest rates exceeding 2% are not uncommon. Woori Bank's WON Installment Savings leads at 2.40%, followed by Suhyup Bank's 'SH Marine Plastic Zero Installment Savings (2.30%)', Shinhan Bank's 'Shinhan Smart Installment Savings (2.20%)', K Bank's 'CodeK Free Installment Savings (2.10%)', Daegu Bank's 'My Created Bonus Installment Savings (2.05%)', and Nonghyup Bank's 'e-Interest Preferential Installment Savings (2.04%)'. Additionally, some installment savings products with interest rates in the 1% range can guarantee rates in the 2% range if certain preferential conditions are met.

For savings bank products, although preferential conditions must be met, products with interest rates exceeding 5% have also appeared. Pepper Savings Bank's 'Pepper Lulu 2030 Installment Savings' has a base interest rate of 3.50%, but it rises to 5% if two preferential conditions are satisfied. Furthermore, some special marketing products from certain banks and savings banks offer high maximum interest rates in the 7-10% range when specific preferential conditions are met. An industry insider stated, "Since there is a high possibility of additional interest rate hikes throughout the year, setting shorter savings and deposit periods and monitoring the trend is also a good strategy."