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Singapore T Bills: Low-Risk Investment for Guaranteed Returns

t bills
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Treasury bills are short-term investments issued by the government and offer returns within a short period. Treasury bills, or T-bills, are attractive security bonds because they are readily available and sold at a discount.

So, why should you invest in T bills? Treasury bills offer lucrative deals to investors who need to invest in a secure environment. These short-term investments mature within a short period and offer attractive rates.

If you want to start investing in T bills, this guide will help you understand what T bills are, the current T bill rate in Singapore, the eligibility criteria for investing in T bills, and the benefits and risks of investing in treasury bills. 

What Are Treasury Bills?

Treasury bills are short-term investments offered by the Singapore government. T bills are among the four types of Singapore Government Securities SGS, and you only buy them at a discount.

T bills mature in Singapore mature either after six months or after one year, but the 6 months bills are more common.

Current State of Treasury Bills

Since the Fed is expected to increase the interest rates through 2023, there are chances that the rates of T bills will rise further. So, the current state of the T bill is inviting, and you can invest now or later to secure higher interest.

At the beginning of February 2023, the T bills in Singapore were slightly higher than that of the January 2023 auction. This is because the cut-off yield for February was at 3.93% compared to the cut-off yield of January 2023, which was 3.88% per annum.

During these months, a total of $4.9 billion was allotted, and an amount of $737.3 million was issued to non-competitive applications.

businessman counting his cash envelope

Benefits of Investing in Treasury Bills

Here are the many benefits you get after investing in treasury bills.

1. Treasury Bills Are Risk-Free

Treasury bills are popular short-term Singapore government securities backed by the central government. They are a liability to the government and need to be repaid within the set date. 

You enjoy comprehensive security for your funds as they are backed by the Singapore government and are always paid, even during an economic crisis.

2. Short-Term Maturity

Since government treasury bills are short-term fundraising tools, they must be repaid for a maximum of one year. They are a perfect option to generate short-term gains in a secure environment. 

You can also sell them in a secondary market, thus allowing you to convert them into cash in an emergency.

3. Non-Competitive Bid

T bills are auctioned by the Monetary Authority of Singapore every week through competitive and non-competitive bidding. This method allows small–scale and retail investors to participate without quoting the price or yield rate.

Risks of Investing in Treasury Bills

Although investing in T bills is a good idea, some risks are associated. Some of these risks include:

1. Inflation Risk

Like any other economy, Singapore experiences inflation from time to time. Since T bills are short-term investments, a little inflation can affect your returns negatively.

2. Interest Rate Risk

Generally, when the interest rate rises, the market’s value in debt securities will drop. This makes it hard to sell your T bills without losing your investment.

3. Market Risk

When a country’s economy expands, the equity performance of the stocks appears less risky. Many investors invest in stocks because they offer higher returns than T Bills. 

When a country is experiencing a tough economic environment, the T bills become attractive to investors who want to invest in a less-risky environment.

4. Opportunity Cost

Although T bills are considered to be risk-free, they offer low returns on your investment compared to other investment options. When you invest in T bills, you lose a chance to invest your money in a place with a higher interest rate.

Comparison of T Bills to Other Fixed Income Investments

The Monetary Authority of Singapore offers different fixed-income investments. These investments include the Singapore Savings Bond (SSB), Singapore Government Securities SGS Bonds, and T bills.

At a Glance: Here’s a table comparing T Bills to other fixed income investments in Singapore.





Singapore Savings Bonds (SSBs)

Bonds issued by the Singapore government, offering risk-free interest payments every six months. Ideal for those investing for over 10 years.


Average return of 2.75% annually for 10-year investment

Singapore Government Securities (SGS) Bonds

Tradable government securities that pay fixed interest payments every six months. Offered in three categories: SGS infrastructure, SGS market development, and Green SGS for infrastructure.

Low to moderate

Higher interest rates for longer tenors

Treasury Bills (T Bills)

Short-term investments issued by the government, offering returns within a short period. Zero-coupon bonds, purchased at a discount.


Guaranteed return upon maturity, no interest payments

The SSBs are bonds issued by the government, offering risk-free interest payable after every six months. They are ideal for people who want to invest for over ten years, and want a premium for their investment. The average return for investing in SSBs for 10 years is 2.75% annually.

On the other hand, SGS bonds are tradable Singapore government securities that pay fixed interest payments after every six months. They usually have a longer tenure and are issued in three categories: the SGS infrastructure, SGS market development, and Green SGS for infrastructure.

Just like the SSBs, the SGS bonds have regular interest rates paid after every six months throughout your bond tenor. The longer you hold the SGS, the more interest rates you receive, but you can always sell them prematurely in secondary markets.

Treasury bills are short-term investments issued by the government and offer returns within a short period. Remember, T bills are zero-coupon bonds, so there are no interest rates; instead, you buy them at a discount. 

Woman paying cash for bill restaurant

Eligibility Criteria for Investing in Treasury Bills

The eligibility criteria for investing in treasury bills vary from country to country. Here are the mandatory requirements for Singaporean citizens or permanent residents wishing to buy T bills in Singapore.

  • The applicant must be at least 18 years old.
  • The applicant must not be an undischarged bankrupt.
  • You should invest a minimum sum of S$1,000.
  • You must open a bank account and a Central Depository Securities Account.
  • You must have an SRS Account/ CPF Investment Account with UOB.

Issuance of Treasury Bills

In Singapore, one-year T bills are issued after every four months, while the 6-month bills are issued after every two weeks. To invest in T bills, the applicant is supposed to invest a minimum of S$1,000 and a maximum of S$ 1 million.

You can purchase T bills in auctions that typically occur three business days before the issuance. Auctions are announced on the SGS website five days before the auction day.

Ensure you have enough funds in your account before you apply because the bid amount is debited to your account when applying for T bill auctions. Also, apply early if you apply through your ATM or internet banks because the issuance closes 1-2 business days before the auction date.

There are numerous ways you can invest in T bills. You can use cash, SRS funds, or CPF funds.

1. Investing in Using Cash

You need a bank account with your local banks to invest in T bills using cash. Also, you need a CDP account, and the Direct Crediting Services should be activated since the payments need to be credited directly into your account.

Remember, you can’t buy T bills using a joint CDP account, but you can pay for the application using it. You can also apply using your internet banking portal or ATM but do so early because the applications end online one day before the auction date.

2. Investing Using SRS Funds

To use this option, you must have an SRS account with one of the SRS operators. These operators include the OCSB, DBS, and UOB, and the money should be deposited into your account before you start the application process.

You can apply through one of these banks or their internet banking portals. If using internet banking, apply early as it closes one day before the auction date.

3. Investing Using CPF Funds

When investing in T bills using this application, you must have an active CPF Investment Account with one of the CPFIS agent banks. Unlike other options, you must submit your application manually at any branch of CPFIS bond dealers.

At a Glance: Here’s a Comparison Table

Investment Option


Application Process


Bank account with local banks, CDP account, Direct Crediting Services activated

Apply online using internet banking portal or ATM, or pay for application using joint CDP account

SRS funds

SRS account with OCSB, DBS, or UOB, funds deposited

Apply online using internet banking portal or through one of the banks

CPF funds

Active CPF Investment Account with CPFIS agent bank

Submit application manually at any branch of CPFIS bond dealers

The Auction Process

T bills in Singapore are issued using a uniform-price auction, and successful competitive bids are allotted at a uniform yield. You are given the option to invest in competitive and non-competitive bids.

1. Competitive Bid

In this type of bid, you only invest in the T bill if the cut-off yield is above a specified level. Therefore, you can only specify the yield you want to receive in percentage. 

You can submit several competitive bids with different amounts to increase the chances of having some of your bids allocated.

2. Non-Competitive Bids

In these types of bids, you are allowed to specify the amount of bid you want to invest, not the yield. This option is ideal for investors who want to invest in T bills regardless of the returns they offer.

Non-competitive bids are allocated first, but if the amount exceeds 40%, they will be allocated pro-rated. The remaining part is issued to competitive bids starting from the lowest to the highest yields.

How to Check the Auction Results

Generally, one is issued T bills three days after the results are shown. You’d see the results on your CDP statement if you invested in T bills using cash. On the other hand, if you applied through SRS and CPF funds, check your statement in your agent bank.

Case Study: Investing in T Bills

To invest in T bills, you must have an active CPF Investment Account with one of the CPFIS agent banks if you’re applying through CPF or SRS savings. However, if you’re applying for them through cash, you can easily use your internet banking account.

So, what do you expect after investing in T bills? Here is a case study that will help you understand how they work.

Assuming you have $1,000 that you want to invest in 6-month T bills, here are the steps to follow:

Step 1: Apply to Bid

On the announcement date, you must apply to bid through POSB/DBS and UOB internet banking, but for your application to be considered, ensure you know the exact cut-off time.

Step 2: Wait for Auction Results

After applying, you will need to wait for auction results to be released, which will be available to access them one hour later.

Step 3: Analyze Results

The Auction results will show the cut-off price and cut-off yield. In this case, the cut-off price will be $98.065, and the cut-off yield will be 3.88% per annum.

Step 4: Refund of Discount

On the issuing date, you will be refunded your discount based on the cut-off price. In this example, the discount is $10.935, which means your account will have +$19.35.

Step 5: Maturity Date

On the maturity date, which is 6 months after the issuing date, you will receive a face value of $1,000.


Remember, investing in T bills comes with its advantages and disadvantages. T bills are low-risk and offer guaranteed returns. They are also short-term; you can always sell them in the secondary market. However, investing in T bills can expose your investments to inflation, interest rate, and market risks.

Key Takeaways

  • T bills are a low-risk investment with guaranteed returns and are backed by the Singapore government
  • Singaporeans must meet certain eligibility criteria to invest in T-bills, such as having an SRS or CPF investment account and investing a minimum sum of S$1,000
  • Treasury bills are short-term investments issued by the government and offer you returns within a short period.
  • You can always sell your T bills before maturity in secondary markets.

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