In today’s uncertain financial environment, Singapore Treasury Bills (T-Bills) have become an attractive option for cautious investors seeking low-risk, short-term investments with competitive returns. Backed by the Singapore Government, T-Bills are viewed as one of the safest ways to preserve capital while earning better yields than most traditional savings accounts or fixed deposits.
Whether you’re new to investing or simply looking to make your idle funds work harder, T-Bills offer a straightforward, accessible solution. They are issued at a discount and mature at face value, with the difference representing your return—no complex calculations or long-term commitments required.
This beginner-friendly guide will walk you through the essentials of Singapore T-Bills: what they are, how they function, the benefits they offer, and how you can easily invest in them through local banks or government platforms. If you’ve been searching for a reliable stepping stone into the world of investments, T-Bills might just be the smart, secure starting point you’ve been waiting for.
What Are Singapore T-Bills?
Singapore Treasury Bills, commonly referred to as T-Bills, are short-term debt securities issued by the Singapore Government through the Monetary Authority of Singapore (MAS). The official name for these instruments is Singapore Government Treasury Bills.
T-Bills are part of a broader suite of Singapore Government Securities (SGS), but unlike SGS bonds, which have longer maturities and pay periodic interest, T-Bills are issued at a discount and do not pay periodic interest. Instead, investors receive the full face value at maturity, with the difference between the purchase price and face value representing the return or yield.
Purpose of Issuance
T-Bills are issued for two main reasons:
- Government cash flow management – They help MAS manage short-term funding needs and liquidity in the financial system.
- Development of the domestic debt market – Regular issuances help build a robust and transparent benchmark yield curve.
Maturity and Issuance Frequency
Singapore T-Bills are available in two typical tenors:
- 6-month (182-day)
- 1-year (364-day)
These are issued regularly—typically every two weeks for the 6-month T-Bill, and approximately every quarter for the 1-year version. MAS publishes the auction calendar in advance on its official website.
T-Bills vs SGS Bonds: Key Differences
| Feature | T-Bills | SGS Bonds |
|---|---|---|
| Maturity | Short-term (6 months to 1 year) | Long-term (2 to 50 years) |
| Interest Payments | None (sold at discount) | Pays periodic coupon interest |
| Yield | Realised at maturity | Periodic, based on coupon rate |
| Suitability | Short-term cash management | Long-term wealth building |
Why Invest in T-Bills?
For beginners and cautious investors, T-Bills offer several key advantages:
✅ Low Risk
T-Bills are backed by the Singapore Government, which holds a AAA credit rating—one of the highest globally. This makes them among the safest investments available.
✅ Competitive Returns
Yields on T-Bills often exceed those offered by traditional fixed deposits, especially during periods of rising interest rates. As of 2025, 6-month T-Bill yields have ranged between 3.6% to 4.0% per annum, while most fixed deposit rates hover below 3.5%.
✅ Short-Term Liquidity
With short maturities, investors can access their funds relatively quickly, making T-Bills an ideal option for parking cash without long-term lock-in.
✅ Zero Capital Loss if Held to Maturity
As long as you hold the T-Bill to maturity, you are guaranteed the face value, eliminating market fluctuation risk.
How Do T-Bills Work?
T-Bills are zero-coupon securities, meaning they don’t pay interest periodically. Instead, they are sold at a discount to their face value. For example:
- You buy a 6-month T-Bill with a face value of $1,000 for $970.
- At maturity, you receive $1,000.
- Your yield is the difference:
(1000−970)/970(1000 – 970) / 970(1000−970)/970 × 100 = 3.09% annualised
This is known as the implied yield or cut-off yield, which is determined via an auction process.
How to Buy Singapore T-Bills (Step-by-Step)
✅ Eligibility
Anyone aged 18 and above with a Central Depository (CDP) account and a linked bank account (DBS/POSB, OCBC, or UOB) can apply. T-Bills can be purchased by individuals, corporations, or institutions.
✅ Application Channels
You can apply via:
- Internet banking portals (DBS, OCBC, UOB)
- ATMs of the above banks
- Cash/CPF/SRS options are available depending on the investment account used
For institutional investors, applications go through the MAS Electronic Auction System (MEAS).
✅ Accounts Required
- CDP Account: To hold the T-Bills in your name
- Bank Account: Linked for payment and refunds
✅ The Bidding Process
There are two bidding methods:
- Non-competitive: You agree to accept whatever yield is decided at auction.
- Competitive: You specify your minimum acceptable yield. If the market clears below your rate, you may not get allocated.
Most beginners should opt for non-competitive bids for simplicity and guaranteed allocation (subject to availability).
✅ Minimum Investment
- $1,000, in multiples of $1,000
- No upper limit, though institutional demand often influences allocation for larger bids
✅ Staying Updated
Check MAS’s Issuance Calendar or subscribe to auction alerts via bank platforms or financial news portals.
Things to Consider Before Investing
🔄 Liquidity
T-Bills are not easily tradable on the secondary market, and early redemption isn’t typically possible. You should be prepared to hold them until maturity.
💰 Fees
There are no transaction fees when applying through internet banking for individuals. However, some administrative charges may apply when using CPF/SRS funds.
🧾 Taxation
Interest or gains from Singapore T-Bills are not taxable for individuals in Singapore, making them even more attractive from a net return perspective.
⚠️ Risks
While T-Bills are among the safest instruments, some risks include:
- Reinvestment risk: You may not get the same yield in future auctions.
- Inflation risk: If inflation rises above your yield, real returns diminish.
- Allocation risk: In oversubscribed auctions, especially during high demand periods, you might receive only partial allocation.
Common Myths and Misconceptions
❌ “Only the wealthy can buy T-Bills.”
False. With a minimum investment of just $1,000, T-Bills are accessible to almost anyone.
❌ “T-Bills and bonds are the same.”
Not quite. While both are debt securities, T-Bills are short-term and issued at a discount, whereas bonds are long-term and offer periodic interest.
❌ “You must be a finance expert to invest in T-Bills.”
Not at all. The process is beginner-friendly, especially when using non-competitive bids through your bank.
Final Thoughts: Why T-Bills Make Sense for Beginners
Singapore T-Bills present a compelling case for inclusion in any beginner’s investment portfolio. They offer:
- Government-backed safety
- Competitive short-term returns
- A simple and accessible buying process
- Tax-free income
Whether you’re looking to earn more than a regular savings account, park funds temporarily, or diversify your investment approach, T-Bills provide a low-risk, flexible solution.
With a bit of research and minimal effort, you can start harnessing the benefits of T-Bills and take one more confident step on your financial journey.