SINGAPORE (May 18): Central Provident Fund (CPF) members will continue to earn at least 2.5% interest on their Ordinary Account (OA) and 4% interest on their Special and Medisave Accounts (SMA) in 3Q ending 30 September 2016, Singapore’s CPF Board announced on Wednesday.

CPF OA interest rates are computed quarterly, with members earning either the legislated minimum interest rate of 2.5%, or the 3-month average interest rates of major local banks, whichever is higher. OA interest rate will be kept at 2.5% as the computed interest rate was 0.24%.

This means that the concessionary interest rate for HDB mortgage loans, pegged at 0.1% above the OA interest rate, will also remain unchanged in 3Q.

CPF SMA interest rates are also adjusted quarterly, with members either the current floor interest rate of 4%, or the 12-month average yield of 10-year Singapore Government Securities plus 1%, whichever is higher. SMA interest rate will be kept at 4% as the computed interest rate was 3.43%.

As part of the government’s efforts to boost retirement savings, an additional 1% interest will be earned on the first $30,000 in a member’s combined CPF balance, with up to $20,000 from the OA.