Update (19 April 2017): Article has been updated below with public information provided by UOB.
Through a new partnership between Singapore Airlines and UOB, a unique Savings Account (KrisFlyer UOB Savings) will be introduced to the market to enable customers to earn KrisFlyer miles based on how much they save and spend (on the dedicated Krisflyer UOB debit card). The rate of mile accrual depend largely on the total account balance and customers will also receive special benefits on Scoot and Tigerair.
Information is scarce at the moment but according to what The Straits Times have reported, the new KrisFlyer UOB Account will earn the following rates based on your total account balance in the account (at this moment it is unclear how much interest, if any, will the account earn):
|Account Balance||Mile Accrual Rate|
|S$3,000 to S$100,000||1.4|
|S$100,000 to S$350,000||3.4|
In order to earn the maximum mile accrual rate of 5.4 miles per dollar on the KrisFlyer UOB debit card (yes, it is indeed a debit card), you will have to maintain a balance of above S$350,000. The KrisFlyer UOB Savings Account also offers cardmembers special privileges on Scoot and Tigerair when they book using the KrisFlyer UOB debit card on a dedicated site (www.flyscoot.com/KrisflyerUOB) or via UOB's mobile banking app, UOB Mighty - receive 5kg bonus baggage when you buy 20kg of baggage allowance.
Working under the assumption that the KrisFlyer UOB Account does not give you any interest, putting up to S$100,000 to earn 1.4 miles per dollar on each dollar of debit card spend is extremely unwise - you can easily get credit cards in market that give you anywhere from 1.2 miles (e.g. Citibank Premiermiles) to 1.4 miles (e.g. UOB PRVI Miles) per dollar. The only lucrative bit from this account is when you park S$100,000 for 3.4 miles per dollar or S$350,000 exactly (there is no incentive to put more money in it) for 5.4 miles per dollar - obviously it depends on what your personal opportunity cost (based on your risk profile and appetite) is for the rest of the day. Potentially this could replace even the best miles card that UOB has to offer (which currently stands at 4 miles per dollar) - it will also be crucial to see whether 5.4 miles per dollar is awarded on all categories of retail spend and whether there is a cap on the maximum number of miles to be earned.
Everything You Need to Know about the KrisFlyer UOB Savings Account
There is finally information available on the internet and here are the top few things you need to know about this account:
- Earn 2 miles per S$5 spent on KrisFlyer UOB Debit Card (0.4 miles per dollar) - Base Miles
- Minimum spend of S$500 per month required.
- Earn up to 25 bonus miles per S$5 (5.0 miles per dollar) based on Deposit Balance (please refer to table above).
- Miles issued in S$5 blocks like the rest of the UOB Credit Cards - spending S$4.99 gets you nothing!
- Bonus KrisFlyer miles earned will be capped at 5% of the Monthly Average Balance in KrisFlyer UOB account (e.g. if you have S$350,000 in your account, you can earn up to 17,500 bonus miles - S$3,500 spend per month).
- KrisFlyer UOB Account earns no interest (on Deposit Balance).
With the 5% bonus miles cap on the total Deposit Balance, there is definitely incentive to save more but if you work out the math behind it, it really isn't worth it - check out the table below!
|KrisFlyer UOB Account|
|Deposit Balance||5% Cap (Bonus Miles)||Bonus Miles||Maximum Spend on Debit Card|
As I have mentioned previously, this account probably only makes sense if you intend to deposit more than S$100,000 and after looking at the terms and conditions, putting S$350,000 in the KrisFlyer UOB Account will only enable you to enjoy up to S$3,500 worth of bonus miles each month - not at all impressive if you ask me.
You do get some exclusive benefits when you travel on Scoot and Tigerair however - these benefits include priority check-in and boarding, additional 5kg baggage allowance, complimentary standard seat selection as well as the convenience fee waiver. Here are the fine prints:
- Complimentary Seat Selection applies to Cardholder ONLY.
- Purchase a minimum of 20KG up to 35KG to get 5KG extra.
- Convenience Fee Waiver applicable to transactions greater than S$250 - only one waiver voucher will be issued per calendar year. The convenience fee waiver voucher can only be used
to offset any convenience fees incurred in the next transaction for the said Cardmember
only, up to a maximum of two flight segments, provided that payment for such flight was
made on the Card in the same booking through the dedicated site.
The 5% cap on the number of bonus miles one can earn is definitely the most limiting factor. If you put S$350,000 into the KrisFlyer UOB Account and spend S$3,500 each month (which is the maximum!) on the KrisFlyer UOB Debit Card, you may earn up to 226,800 miles each year. Conversely, if you plan your expenditure carefully and charge all of those expenses (and more!) to a credit card that gives you 4 miles per dollar, you can earn up to 168,000 miles each year. Sure, that additional 58,800 miles sounds great but having to park S$350,000 in an account that doesn't give you interest for that is just a terrible idea. In addition to that, if for the strangest reason, I do sign-up for this account and earn 226,800 miles a year, why would I bother with the pretty-unimpressive benefits on low-cost carriers like Scoot and Tigerair?