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Time Deposit in the Philippines: Complete Guide to High-Yield Savings
You may have received a bonus, built up some savings, or set aside part of a remittance that you will not need right away. You may now be deciding whether to keep the money in a regular savings account or place it in a time deposit.
A regular savings account gives you easier access to your money. A time deposit may offer a fixed interest rate, but you agree to leave the money with the bank for a set period. If you close the account before its maturity date, you may earn less interest and pay additional fees.
To compare your options, look at the term, interest after tax, early-closure cost, and what happens when the account matures.
What is a time deposit account?
A time deposit is a bank account where you deposit a fixed amount for an agreed period, called the term. The bank pays you interest at a rate confirmed when you open the account. Your money stays there until the maturity date, or the end of the term.
You can think of a time deposit as setting aside money for a future date: you know when you plan to use it, but taking it out earlier may reduce the interest you receive.
A time deposit may also be called a:
term deposit
fixed deposit
fixed-term deposit
These terms generally mean the same thing.
How a time deposit works in the Philippines
A bank time deposit usually works in five stages.
1. You choose how much to deposit
Each bank sets a minimum opening amount. How much you deposit may also affect the interest rate you receive.
Before opening a time deposit, set aside enough money for bills and planned expenses due before the maturity date. Place only the amount you are unlikely to need during the term.
2. You choose a term
Common time deposit terms include:
30, 60, or 90 days
6 or 9 months
1 year
2–5 years
longer terms offered by selected banks
Choose a term that matches when you expect to use the money. A longer term is not automatically the better choice.
Check whether tuition, insurance payments, home repairs, business expenses, travel, or other large costs may fall within the term.
3. The bank confirms the interest rate
The bank tells you the annual interest rate before you open the account. Banks often write this as a percentage per annum or p.a. For example, 4% p.a. means an annual interest rate of 4% before tax.
Once your account is open, the rate usually stays fixed until maturity. If you renew the account, the bank may apply the rate available at that time.
4. Your account earns interest
The bank calculates your interest using the deposit amount, annual rate, and length of the term. Depending on the account, the bank may:
pay your interest at maturity
credit it monthly
transfer it to another account
add it to your original deposit
When the bank adds the interest to your deposit, it may also earn interest. This is called compounding.
5. Your account matures
At maturity, the bank follows the instructions you chose when you opened the account.
The bank may transfer your original deposit and interest to another account or renew the time deposit for another term.
Confirm whether the bank will transfer the money or renew the time deposit automatically. It also helps to add the maturity date to your calendar so you can review your options before the term ends.
Minimum deposits and available terms
The minimum deposit and available terms depend on the bank you choose. Here are selected examples based on information checked on July 15, 2026:
Bank or product | Minimum deposit | Selected available terms |
Example bank 1 time deposit | ₱5,000 for terms of 30 days to 1 year; ₱100,000 for longer terms | 30 days to 5 years and 1 day |
Example bank 2 time deposit | ₱100,000 | 30 days to 7 years |
Salmon Time Deposit | ₱5,000 | 6 months to 5 years |
Example bank 1 starts at ₱5,000 for terms of up to 1 year and requires a higher minimum for longer terms. Example bank 2 requires ₱100,000, while Salmon Time Deposit starts at ₱5,000.
Compare accounts using the same deposit amount and a similar term. Look at the net interest in pesos—not only the advertised percentage—and how much each bank would return if you closed the account early.
Time deposit interest rates
The rate you receive depends on the bank, how much you deposit, and how long you leave your money in the account. It may also depend on:
when and where the bank pays the interest
changes in inflation or BSP policy rates
how much interest banks are willing to pay for deposits
whether the offer is promotional
Before choosing an account based on a promotional rate, check:
the minimum deposit
the required term
whether the rate applies for the whole term
the promotion end date
the rate the bank may use if the account renews
Each bank decides what rate to offer for a particular account, amount, and term.
In June 2026, the Bangko Sentral ng Pilipinas raised its key policy rate to 4.75%. This is not the same as the rate on your time deposit, and banks do not have to adjust their deposit rates by the same amount. However, changes in BSP policy can influence the rates banks offer over time to 4.75%. This is not the same as the rate on your time deposit, and banks do not have to adjust their deposit rates by the same amount. However, changes in BSP policy can influence the rates banks offer over time.
How much could your time deposit earn?
Here is what a time deposit rate could mean in pesos.
A basic time deposit formula is:
Gross interest = principal × annual rate × number of days ÷ 365
The principal is the amount you originally deposit.
Your bank may count the number of days differently, so the final amount can vary slightly. The account terms should explain the exact calculation method.
Example: ₱50,000 at 3% for 1 year
Suppose you deposit ₱50,000 for 365 days at 3% p.a.
Gross interest:
₱50,000 × 3% × 365 ÷ 365 = ₱1,500
Before tax, your time deposit would earn ₱1,500 in interest.
If the bank deducts a 20% final withholding tax: ₱1,500 × 20% = ₱300 tax
After the bank deducts the tax, your estimated net interest would be: ₱1,500 − ₱300 = ₱1,200
At maturity, you would have an estimated total of: ₱50,000 + ₱1,200 = ₱51,200
For a term of around 6 months, the gross interest would be roughly half the annual amount. The exact figure depends on the dates and your bank’s calculation method.
Interest after tax
The gross interest is not always the amount you receive because the bank may deduct tax.
For many individual peso time deposits, the bank deducts a 20% final withholding tax before it credits or pays the interest.
A quick estimate is: Net interest = gross interest × 80%
Tax treatment may differ depending on the currency, account, and date it was opened. Use the bank’s latest information when estimating how much you may receive.
See how much your savings could earn
Enter how much you plan to deposit in our Salmon Time Deposit calculator and see your estimated gross interest. Calculate your interest
Types of time deposits
Time deposits are commonly grouped by currency.
Peso time deposit
A peso time deposit can be useful when your savings and future expenses are both in Philippine pesos.
You deposit a fixed amount for an agreed term and earn the stated interest rate. PDIC insures eligible deposits up to ₱1 Million per depositor, per bank. This limit applies to your combined eligible deposits with the same bank.
Foreign-currency time deposit
Some banks offer foreign currency time deposits in selected currencies. Available currencies, minimum deposits, and terms vary by bank.
This type of account can make sense if you earn or expect to spend the same currency. An OFW, for example, may choose to keep part of their savings in US dollars instead of converting the full amount to pesos. If you measure your savings in pesos, its value can rise or fall as exchange rates change.
PDIC’s official FAQ confirms that time deposits and foreign currency deposits are covered deposit products, subject to eligibility requirements.
When banks pay the interest
How and when you receive the interest depends on the account.
The bank pays it to another account
Some banks credit your interest to another account each month, quarter, or at another stated interval. This arrangement lets you receive the interest while your original deposit stays in the time deposit.
The bank adds it to your time deposit
You may also be able to leave the interest in the account, where it can earn additional interest.If you want to receive the interest regularly, look for an account that credits it to another account. If you do not need it yet, leaving it in the time deposit may allow it to compound.
Check whether the interest payment option affects the rate or other account terms.
Time deposit vs savings account
Access to your money is the main difference between a time deposit and a regular savings account.
Money you may need at any time usually belongs in a savings account. Money set aside for a known future date may be more suitable for a time deposit.
Feature | Time deposit | Savings account |
Access to money | You agree to leave it until maturity | You can normally access it when needed |
Interest rate | The bank usually fixes it for the term | The bank may change it |
Additional deposits | You may need to open a separate account | You can usually make regular deposits |
Withdrawals | Closing early may reduce your interest and result in fees | You normally do not pay an early-closure fee |
Main use | Money you have set aside for a future expense | Daily funds, upcoming expenses, and emergency savings |
Maturity date | Yes | Usually none |
Automatic renewal | May apply | Not normally applicable |
You may use a savings account for everyday and emergency needs, then place money for a specific future expense in a time deposit.
Benefits of a time deposit
You have a clearer idea of how much interest you could earn
Because the bank fixes the rate for the term, you can estimate your interest before opening the account.
You can separate money for a planned expense
A time deposit can keep money for tuition, home repairs, business equipment, or another planned expense away from your everyday spending.
Your balance does not rise and fall with the market
A time deposit keeps your original deposit away from daily changes in market prices. This is sometimes called capital preservation.
Unlike shares or investment funds, the value of your time deposit does not change with the market.
However, your balance can increase while your money buys less than before if prices rise faster than your net interest.
PDIC insures eligible deposits
Eligible deposits include savings, checking, and time deposit accounts, among other deposit products held with a PDIC member bank. PDIC insures these deposits up to ₱1 Million per depositor, per bank.
The limit applies to eligible deposits held with the same bank under the same ownership category, rather than to each account separately. Individually owned accounts are insured separately from joint accounts.
Costs and limits to consider
A fixed interest rate also means less access to your money during the term.
Your money is less accessible
A time deposit is meant for money you can leave in the account until maturity.
Closing the account early can reduce your interest
The bank may apply a lower interest rate, charge a fee, or deduct applicable taxes and other charges.
Prices may rise faster than your interest
Even with a fixed rate, the cost of goods and services may rise faster than the interest you earn.
What happens if you need the money early?
You may need the money earlier than expected because of a medical expense, home repair, or another unplanned cost. Closing a time deposit before maturity is sometimes called pre-termination. In this guide, we use the clearer term early closure. Before opening the account, ask the bank:
what interest rate it would use if you closed the account early
how it calculates the early-closure fee
whether it allows partial withdrawals
how much you would receive in a sample early-closure calculation
These answers can show whether the account still fits your plans if you need the money sooner than expected.
Example using Salmon’s early-closure conditions
Suppose you open a Salmon Time Deposit with ₱100,000 at 6% for 1 year but close it after around 6 months.
Under the current terms, Salmon would generally recalculate the interest at 1% p.a.
Recalculated gross interest: ₱100,000 × 1% × 0.5 = about ₱500
After an estimated 20% withholding tax: ₱500 × 80% = about ₱400 net interest
Salmon normally charges an early-closure fee equal to 0.75% of your original deposit: ₱100,000 × 0.75% = ₱750
A simplified estimate would be: ₱100,000 + ₱400 − ₱750 = about ₱99,650
Other taxes or charges listed in the account terms may also affect how much you receive.
For a Salmon Time Deposit with a term of at least 4 years, Salmon waives the 0.75% fee when you close the account after holding it for at least 3 years. The lower interest rate and applicable taxes may still apply. Source: Salmon Deposit Features and Fees.
What is a time deposit ladder?
You do not have to place all your money in one time deposit.A time deposit ladder divides your money among several accounts with different maturity dates.
For example, instead of placing ₱150,000 in one 1-year time deposit, you could divide it into:
₱50,000 for 6 months
₱50,000 for 9 months
₱50,000 for 12 months
When one account matures, part of your money becomes available. You can use it or place it in another time deposit based on the rates and terms available at that time.
A ladder may help when you expect to need parts of the money on different dates or are unsure whether you can leave the full amount untouched for 1 year.
It may be unnecessary when you have only one planned expense with a clear date or prefer to manage a single account.
A ladder does not remove early-closure charges, but not all your money will be tied to the same maturity date.
Is a time deposit a good fit for your savings plans?
A time deposit may fit your plans when you know what the money is for and when you expect to use it.
It offers predictable interest, and its balance does not rise and fall with the market. However, it is a deposit account, not an investment whose value can go up or down.
A time deposit may suit you when:
you have money you do not need immediately
you know when you expect to use it
you prefer a fixed interest rate
you understand the cost of closing the account early
the estimated interest after tax meets your needs
It may be less suitable when:
your income or expenses are uncertain
you may need the money without notice
you have debt with a much higher interest rate
you are saving for a long-term goal and are comfortable with an investment going up or down in value
Before opening a time deposit, answer 3 questions:
1. Will I need any part of this money before maturity?
2. How much interest will I receive after tax?
3. Am I comfortable with how much I may receive if I close the account early?
You can keep your emergency and everyday savings in an accessible account, then place only the money you can leave untouched in a time deposit.
Alternatives to a time deposit
Different accounts may suit different timelines.
Regular savings account
A regular savings account may suit emergency money or expenses without a fixed date because you can access the funds more easily.
Shorter-term deposit
A shorter time deposit may suit money you can set aside but may need within several months.
Longer-term deposit
A longer time deposit may suit money tied to a later expense with a known date, provided you can leave it untouched for the full term.
Government securities and other investments
Government securities, bonds, or investment funds may suit longer-term goals when you understand their different risks, possible returns, and withdrawal rules.
Some investments can rise or fall in value.
Salmon Time Deposit
Salmon Bank (Rural Bank) Inc. offers Salmon Time Deposit. Salmon Time Deposit currently offers:
a minimum deposit of ₱5,000
rates based on how much you deposit and the term you choose
terms from 6 months to 5 years
monthly interest crediting
gross annual rates from 6% to 6.5%
PDIC insurance for up to ₱1 Million per depositor, per bank
Salmon Time Deposit rates
Deposit amount | 6 months | 9 months | 1–5 years |
₱5,000–₱499,999.99 | 6% | 6% | 6% |
₱500,000–₱999,999.99 | 6% | 6% | 6.5% |
₱1 million–₱50 million | 6% | 6% | 6.5% |
Salmon Time Deposit offers 6% gross interest per year for 6- and 9-month terms. For terms from 1 to 5 years, deposits of ₱500,000 or more earn 6.5% gross interest per year, while lower deposit amounts earn 6%.
Salmon credits the interest monthly. You may keep it in Salmon Time Deposit so the balance can compound or ask Salmon to transfer it to a Salmon Checking account.Find your deposit amount in the rate table and choose a term. Then calculate the estimated interest after tax and review how much you could receive if you closed the account early.
Rates can change. Review the offer for your deposit amount and chosen term before opening or renewing an account.
Time deposit comparison checklist
Use this checklist to compare your options:
1. Deposit amount: Can you leave the full amount untouched for the term?
2. Term: Does the maturity date match when you expect to use the money?
3. Interest rate: Does the bank fix it for the full term?
4. Promotional terms: Do your deposit amount and chosen term meet the requirements, and when does the offer end?
5. Net interest: How much could you receive after tax?
6. Interest payment: When and where will the bank credit your interest?
7. Early closure: What reduced rate, fees, taxes, and other charges would the bank apply?
8. Partial withdrawal: Can you withdraw only part of your money, or would you need to close the whole account?
9. Maturity: Will the bank transfer or automatically renew your account?
10. PDIC coverage: When you add this deposit to your other eligible deposits with the same bank, will the total remain within the ₱1 million insurance limit?
11. Where to open the account: Are you using the bank’s branch, official website, or app?
Choose a time deposit that fits your plans. Salmon Time Deposit starts at ₱5,000 and offers terms from 6 months to 5 years. Apply now
Frequently asked questions
What does “term deposit” mean?
A term deposit is money you deposit with a bank for an agreed period at a stated interest rate.
It is another name for a time deposit or fixed deposit. The word “term” refers to how long your money stays in the account.
What is a time deposit also called?
A time deposit is also called a term deposit, fixed deposit, or fixed-term deposit. Banks may use different names, but they generally refer to the same type of account.
What risks should I consider before opening a time deposit?
Consider whether you may need your money before maturity because closing the account early may reduce your interest and result in fees.
Prices may also rise faster than the interest you earn, while deposits above the PDIC limit may not be fully insured. A foreign-currency time deposit also carries exchange-rate risk when you measure its value in pesos.
Can I add money after opening a time deposit?
No, most time deposits accept only one deposit when you open the account. You may need to open another time deposit if you want to add more money later. The bank’s account rules should explain whether it allows additional deposits.
Can I withdraw only part of my time deposit?
It depends on the bank, because some time deposits allow partial withdrawals while others require you to close the whole account.
Check the bank’s rules if you may need access to only part of your deposit.
What happens when my time deposit matures?
When your account matures, the bank follows the instructions you chose when you opened it.
The bank may transfer your original deposit and interest to another account or renew the time deposit. If it renews the account, it may apply the interest rate available on the renewal date.
Is my time deposit covered by PDIC?
Yes, if your time deposit is eligible and held with a PDIC member bank, PDIC insures it up to ₱1 Million per depositor, per bank. The ₱1 Million limit includes your other eligible deposits with the same bank.
Will I always earn more with a time deposit than with a savings account?
No, interest rates vary by bank, deposit amount, term, and promotion.
A savings account with a promotional rate may sometimes pay as much as, or more than, a time deposit. Compare the interest after tax, withdrawal rules, and fees.
Choose a term that works with your plans
A time deposit can provide predictable interest for money you have set aside for a future expense. It works well when the maturity date matches your plans and you can leave the amount untouched.
Before you decide, write down 4 figures:
1. how much you will deposit
2. the maturity date
3. the estimated net interest
4. how much you may receive if you close the account early
These figures give you a clearer picture than the advertised interest rate alone.
20.07.2026