Fixed Income in Singapore: How It Works, Today's Yields and How to Invest

Fixed income means lending your money (to the Singapore government, a bank or a company) in return for scheduled interest and your principal back on a set date. In Singapore it covers T-bills, Singapore Savings Bonds, government and corporate bonds, bond funds and ETFs, and, for accredited investors, private credit. As of early November 2026, Singapore government paper yields about 1.8–2.4% a year, roughly level with inflation of 2.2%.

This guide explains how fixed income works, what each part of the Singapore market pays today, what is left after inflation, how to buy it with cash, SRS or CPF, what can go wrong even with AAA-rated bonds, and how it is taxed. For a closer look at individual bonds, see our guide to bond investment in Singapore. If getting your capital back is the main goal, our guide to safe and low-risk investments in Singapore compares the options by safety.

What is fixed income?

Fixed income is the group of investments that pay a pre-agreed stream of cash. You lend money to an issuer, it pays interest (the coupon) on a schedule, and it repays the principal at maturity. It is called "fixed" because the payments are set in advance, not because the price of the investment or your final return is guaranteed.

Three numbers describe almost any fixed income investment: the coupon (the interest rate on the face value), the maturity (when the principal is repaid), and the yield (the annual return you lock in at today's price if you hold to maturity and the issuer pays in full). When market rates rise, existing bonds with lower coupons become less attractive, so their prices fall until their yield matches the market. That price–rate link is the single most important thing to understand about fixed income.

Here is what counts as fixed income in Singapore:

Fixed deposits behave like fixed income for savers (a set rate for a set term), but they are bank deposits rather than securities. In Singapore, eligible SGD deposits are insured by SDIC up to S$100,000 per depositor per bank or finance company.

Fixed income vs equities

When you buy a bond you become a lender; when you buy a share you become an owner. A lender's income is contractual and ranks ahead of shareholders if the issuer fails, but the upside is capped at the coupon. An owner's upside is uncapped, and so is the uncertainty. That trade-off is why most portfolios hold both. Our guide to the best investment options in Singapore compares the main asset classes side by side.

Singapore fixed income yields today (November 2026)

At the low-risk end, SGD fixed income pays roughly 1–3% a year today. Government paper yields about 1.8–2.4%, the best bank deposits around 2.1%, SGD money market funds 0.9–1.7%, and an SGD investment-grade corporate bond ETF about 3.2%. Anything above that comes from taking currency, credit or liquidity risk.

The yields in this table are measured in different ways, so they are not perfectly comparable. A T-bill's cut-off yield is what you lock in at the auction. The SSB's 10-year average is earned only if you hold for the full decade. A fund's yield to maturity estimates what its bonds pay if held to maturity; it is not the distribution you receive and not a promise of return. A money market fund's 7-day yield is a recent snapshot. Kilde's figure is a past return, not a forecast.

Rates have also moved. The 6-month T-bill cleared at 1.36% in February 2026 and climbed to 1.95% by 22 October, the highest of the year. The 2-year SGS yield rose from about 1.38% a year earlier to 1.86%. Both remain well below the 4.4% T-bill yield reached in December 2022.

Kilde's view. The T-bill versus fixed deposit question barely matters right now: the two sit within about 0.15 percentage points of each other. The decisions that move your result are how much of the yield survives inflation, and what you give up to earn more: liquidity, credit quality, or the certainty of getting the same price back. Every step up the table above is paid for with one of those three.

What's left after inflation

Singapore's headline inflation was 2.2% in September 2026 and MAS core inflation 2.0%. Subtract that from each yield and most cash-like options earn roughly zero or less in real terms. A positive real yield in SGD currently comes from locking in for longer or from taking credit risk.

This is simple subtraction in percentage points, before fund fees, so treat it as a guide. It also uses current inflation, not the inflation you will face over the life of the investment. MAS projects core inflation of 1.5–2.0% for 2026 and 1.5–2.5% for 2027, and headline inflation of around 2.0% for 2026, with risks it describes as tilted to the upside.

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The main types of fixed income in Singapore

Singapore investors can choose from five broad groups: government securities, corporate and government-linked bonds, bond funds and ETFs, money market funds, and private credit. They differ mainly in who is borrowing, how easily you can sell, and whether you need to be an accredited investor to buy.

Singapore Government Securities: T-bills, SSBs and SGS bonds

All three are backed by the Singapore Government and carry its AAA rating. T-bills run for 6 or 12 months and start at S$1,000. Singapore Savings Bonds start at S$500, are capped at S$200,000 per person, and can be redeemed in any month without penalty. SGS bonds run from 2 to 50 years and can be sold before maturity, at whatever the market pays that day. Held to maturity, all three return your principal in full.

Corporate and government-linked bonds

Statutory boards and agencies (HDB, LTA, Temasek) and companies (banks, insurers, REITs, telcos) also borrow in SGD. They pay more than the government because you take on their credit risk. Most SGD corporate bonds are wholesale: MAS defines these as bonds offered only to institutional and accredited investors, or in denominations of at least S$200,000. Since 2016, MAS's bond seasoning and exempt bond issuer frameworks have allowed some issuers to sell bonds to retail investors in smaller lots, but the retail menu remains short. Many bank and telco issues are perpetual securities, which have no maturity date and behave more like a hybrid of debt and equity.

Bond funds and ETFs

A fund lets you own hundreds of bonds with a small ticket. On SGX, the ABF Singapore Bond Index Fund holds mostly Singapore Government bonds, plus bonds from HDB, LTA and others. The Amova SGD Investment Grade Corporate Bond Index ETF holds Temasek, bank and insurer bonds with an average A rating. Both charge a 0.15% management fee, trade like shares, and can be bought with cash, SRS or CPF Ordinary Account savings under the CPF Investment Scheme. Actively managed bond unit trusts on platforms such as Endowus or FSMOne cover more markets, including Asian, global and high-yield bonds, but usually cost more. If you are new to exchange-traded funds, our guide on how to buy ETFs in Singapore covers the mechanics.

Money market funds

Money market funds invest in bank deposits and short-term bills. They offer daily liquidity and no lock-in, but they are not capital-guaranteed and not SDIC-insured. SGD funds yielded 0.90–1.68% net in early October 2026 and USD funds 3.48–3.82%. The gap reflects higher US short-term rates, and it can be wiped out if the US dollar weakens against the Singapore dollar. Our guide to money market funds in Singapore compares the main SGD and USD funds, their fees and how to buy them.

Private credit

Private credit is lending to companies outside public bond markets, usually through secured loans or notes held to the end of their term. It pays more than listed bonds and, in Singapore, is generally available only to accredited and institutional investors. It has its own section further down this guide.

How to invest in fixed income in Singapore

Most Singapore investors reach fixed income in one of four ways. They buy government securities through DBS/POSB, OCBC or UOB, buy bond ETFs on SGX, hold bond or money market funds on a platform, or, as accredited investors, buy wholesale bonds and private credit. The right route depends on your ticket size, how long you can lock money away, and whether you want to use cash, SRS or CPF.

Funds and ETFs vs individual bonds

An individual bond held to maturity has a known end point: barring default, you get the face value back on a set date, whatever happens to rates in between. A bond fund never matures. It keeps replacing old bonds with new ones, so its value when you sell depends on where rates are that day. In return, a fund gives you diversification across many issuers, small ticket sizes and automatic reinvestment. Between the two kinds of fund, ETFs such as the two above track an index at low cost. Unit trusts are usually actively managed, reach more markets and charge more. If you need a specific amount back on a specific date, an individual government bond or T-bill fits better than a fund.

Using CPF and SRS

You can buy T-bills and SGS bonds with CPF savings through the CPF Investment Scheme, but only with Ordinary Account money above the first S$20,000. SSBs cannot be bought with CPF. Check the numbers before you move CPF money. The Ordinary Account pays a legislated minimum of 2.5% a year, which is more than the current 6-month T-bill (1.95%) or 2-year SGS (1.86%) yield, and MAS itself warns that CPF rates may be higher than SGS yields. At today's rates, moving Ordinary Account savings into T-bills lowers your return. SRS money can buy T-bills, SGS bonds, SSBs, the bond ETFs above and eligible funds. That usefully replaces the low interest SRS cash earns while it sits uninvested. Our SRS account guide covers the contribution cap, tax relief and withdrawal rules.

What accredited investors can access

In Singapore you can opt in as an accredited investor if you have net personal assets above S$2 million (your home counts for at most S$1 million of that), net financial assets above S$1 million, or income of at least S$300,000 in the past 12 months. Our guide to becoming an accredited investor in Singapore covers the process. Accredited status opens up wholesale SGD and USD bonds, a wider range of high-yield and perpetual issues through private banks, and private credit. The trade-off is fewer protections: offers to accredited investors usually come without a prospectus, and the investor is assumed to do more of the due diligence. Our explainer on what MAS regulation means for investors sets out what changes.

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Risks: why "fixed" doesn't mean a fixed price

Fixed income can lose money. The coupons are fixed, but the market price of a bond or bond fund moves in the opposite direction to interest rates. Issuers can also default, some holdings cannot be sold quickly, and foreign-currency bonds carry exchange-rate risk. Holding a high-quality individual bond to maturity removes the price risk; holding a fund does not.

Interest-rate risk (duration)

Duration measures how sensitive a bond's price is to a change in yields. A duration of 8 means a rise of 1 percentage point in yields cuts the price by about 8%. The table also shows how far yields can rise before the price fall cancels a full year of income:

Kilde's calculation from yields as of 2 November 2026 (SGS) and fund duration and yield to maturity as of 30 September 2026, assuming bonds priced at par and a parallel 1-point rise in yields.

This is not a theoretical risk. In the 12 months to 30 September 2026, as SGS yields rose, the AAA-rated ABF Singapore Bond Index Fund returned −2.50% and the SGD investment-grade corporate bond ETF −1.55%, both with distributions reinvested. Their three-year returns were still positive (4.77% and 4.91% a year), which shows the other side of duration: it pays when yields fall. October 2026 was a small example. The 10-year SGS yield fell from about 2.48% at the start of the month to 2.24% by 2 November, which lifts the prices of long-dated bonds and the funds that hold them.

Kilde's view. "Fixed" describes the cash flows, not the price. Before buying anything sold as fixed income, ask which risk you are being paid for (duration, credit, liquidity or currency) and whether you can wait it out if that risk shows up. A AAA bond fund can still fall in a year when rates rise, and a high coupon can still default. The investments that disappoint are the ones bought without knowing which of the four was doing the work.

Credit risk

Credit risk is the chance the borrower pays late, pays less or does not pay at all. Government securities carry almost none. The SGD government bond ETF has an AAA average rating, the corporate bond ETF an A average, and high-yield bonds sit below BBB−. Perpetual securities add another layer: issuers can often defer or skip payments under their terms, and there is no maturity date to return your principal. Higher yields almost always mean more credit risk, which is why diversification across issuers, and where possible seniority and collateral, matter more as yields rise.

Liquidity, currency and reinvestment risk

T-bills can be sold before maturity only through dealer banks, often at a cost. Corporate bonds trade thinly in Singapore, and private credit cannot be sold at all before its term ends. Foreign-currency fixed income, such as USD funds yielding 3.5–3.8%, adds exchange-rate risk that can outweigh the extra yield. Reinvestment risk works the other way: if you hold only short-term instruments, your income falls when rates fall. Investors who rolled 6-month T-bills from 4.4% in December 2022 were earning 1.36% by February 2026.

How fixed income is taxed in Singapore

For individuals, most fixed income is tax-free in Singapore. IRAS does not tax interest from approved bank deposits, interest from debt securities such as bonds, or foreign-sourced interest, unless the income is earned through a partnership or as part of a trade. Distributions from SFA-authorised unit trusts received directly by individuals are also exempt.

What this means in practice:

• Compare yields gross for gross. A 2% T-bill and a 2% bond fund distribution are both untaxed for most individuals, so the comparison comes down to fees and risk, not tax.
• Watch foreign withholding tax. A fund or bond based abroad may have tax withheld in its home country before income reaches you. Singapore cannot credit it back, because it does not tax that income in the first place. Fund domicile matters.
• Platform notes can qualify too. In Advance Ruling Summary 03/2021, IRAS treated interest that Singapore resident individuals earned on notes offered through an MAS-licensed online platform as tax-exempt interest from debt securities. Whether a specific product qualifies depends on its structure.

Corporates, trusts and anyone trading bonds as a business follow different rules and should take advice.

How much fixed income do you need?

There is no single right percentage. A practical way to size fixed income is by the job it does: cash you may need within a year, money you want back in full on a known date, and capital meant to produce income. Each job points to a different part of the market, and the third is where the size of the allocation matters most.

Here is how much capital different yields need to produce a given monthly income, keeping the principal intact:

Capital = monthly income × 12 ÷ yield. Before fees; interest is untaxed for most individuals (see above).

Two points follow from today's yields. First, about 2% is what SGD government paper and bank deposits pay now, and about 3% is the yield on an SGD investment-grade corporate bond ETF. Anything above that needs foreign currency, lower credit quality or giving up liquidity. Second, with inflation at around 2%, spending all of a 2% yield leaves your capital losing purchasing power at roughly the same rate. Income you can spend while keeping your capital's real value is closer to the real yields in the inflation table above. For income sources beyond fixed income, such as dividends and REITs, our guide to passive income in Singapore compares ten options.

Where private credit fits in fixed income

Private credit is lending to companies outside public bond markets, usually through secured, shorter-dated loans or notes held to maturity. It is often grouped with fixed income because it pays contractual interest. It behaves differently, though: there is no daily price, no market to sell into, credit risk drives the return, and in Singapore it is generally offered only to accredited and institutional investors.

Kilde is a MAS-licensed platform (Capital Markets Services licence CMS101016) through which accredited and institutional investors fund senior secured loans to non-bank lenders. Terms run from 3 to 36 months, coupons are paid monthly, and fees are capped at 0.5%. As of October 2026, the average net return to investors over the last 12 months was 12.46%, and no investor capital has been lost after recoveries since Kilde launched in 2021, according to the platform's published statistics. These are historical figures, not a yield promise. Capital is at risk, the notes are not bank deposits or SDIC-insured, and you cannot sell before maturity.

Kilde's view. Private credit belongs in the income part of a portfolio, not the capital-preservation part. Its higher yield is payment for credit risk and illiquidity, so it works best as a satellite next to government and investment-grade holdings, funded with money you will not need before the loans mature, and spread across many borrowers rather than concentrated in a few.

How private credit compares with bonds and bond funds in more detail, and how to assess a platform, is covered in our complete guide to private credit investing in Singapore. Our due-diligence playbook for private credit and other non-public assets gives a checklist.

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Which fixed income route fits you

Match the instrument to the job the money has to do.

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