How Does Time Deposit Work?

Have you ever wondered where else you can put your money and make it earn without investing it on other conventional investment options? You can look into time deposits.

Time deposit or what other banks call term deposit is also a kind of savings account that has a higher interest rate. The difference is, you can’t withdraw your money until it “matures,” doing so will result to you paying for a penalty.

Time Deposit


Philippine banks offer time deposits, some require that you open a savings account with them. Ask your preferred bank about it.


This is what they call maturity. You won’t be able to withdraw your money until your money matures and earns interest. The normal terms range from 1 month to 5 years. 1 year and shorter periods are considered short-term while those exceeding a year are long term.

Interest rate

Banks in the Philippines usually offer 1%-1.5% interest rates for short-term deposits and up to 3% interest rates for long term. There are thrift banks that offer interest rates that are as high as 8.5%.

Minimum deposit

Some banks accept time deposits for as low as P1000, while those with longer terms and higher interest require a minimum deposit of P100,000. There are also thrift banks that let you start with just P5,000 or P10,000.

Evidence of ownership

With time deposit, you won’t have any ATM, passbook or any receipt. The bank will just give you a certificate when your deposit matures. This usually shows the amount you deposited, the interest rate, term, and maturity.


When you reach your deposit’s maturity, you can either withdraw all your funds, transfer it to your savings account, or roll it over to a new time deposit term.


Time deposits are insured for up to P500,000 per account holder by the PDIC (Philippine Deposit Insurance Corporation)

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