If you have been hearing about Singapore Treasury Bills — or T-Bills — and wondered what they actually are and how they work, this article explains the basics in plain English. T-Bills became a popular topic among Singapore savers from 2022 onwards when yields rose sharply. Understanding how they work helps you make more informed decisions about where to park your savings.
What is a T-Bill?
A Treasury Bill (T-Bill) is a short-term debt instrument issued by the Singapore Government through the Monetary Authority of Singapore (MAS). When you buy a T-Bill, you are essentially lending money to the Singapore Government for a fixed period — either six months or one year.
T-Bills are backed by the full faith and credit of the Singapore Government, which makes them one of the safest instruments available to Singapore investors. There is no credit risk — the Singapore Government has never defaulted on its debt obligations.
How Do T-Bills Work?
T-Bills are issued at a discount to their face value. This is how they generate a return.
Here is a simple example:
- Face value of one T-Bill: S$10,000
- You pay: S$9,921 (at auction, based on the cut-off yield)
- At maturity (six months later): you receive S$10,000
- Your return: S$79 (the difference between what you paid and what you received)
The return is not paid as interest — it is built into the discount at purchase. This is different from fixed deposits, which pay interest at the end of the term.
What Tenors Are Available?
MAS currently issues two types of T-Bills:
6-month T-Bills
- Auction held approximately every two weeks
- Most popular among retail investors
- Larger issuance size — typically S$7–9 billion per auction
1-year T-Bills
- Auction held less frequently (approximately monthly)
- Slightly higher yield than 6-month T-Bills in most rate environments
- Less issuance — typically S$2–3 billion per auction
How Are T-Bills Auctioned?
T-Bills are sold through a competitive auction process run by MAS. There are two types of bids:
Non-competitive bid
- You apply for a fixed amount and agree to accept whatever yield the auction produces (the "cut-off yield")
- Allotment is guaranteed, subject to the 40% cap on non-competitive bids per auction
- Most retail investors use this method — it is simpler and removes the need to forecast the cut-off yield
Competitive bid
- You specify the yield you want
- If your bid yield is at or below the cut-off yield, you receive full allotment
- If your bid yield is above the cut-off yield, you receive nothing
- Typically used by institutional and sophisticated investors
What is the cut-off yield? The cut-off yield is the highest yield accepted in the auction — it is the yield where total demand meets total supply. All successful non-competitive and competitive bidders receive the same cut-off yield, regardless of what they bid.
How Do I Apply for a T-Bill?
Retail investors in Singapore can apply through several channels:
Via internet banking (cash application)
- DBS/POSB, OCBC, and UOB internet banking portals
- Applications typically open one week before the auction date
- Closing time is usually 9pm the day before the auction
Via ATM
- Available at DBS/POSB and OCBC ATMs
Via CPF Investment Scheme (CPFIS)
- You can use CPF Ordinary Account (OA) funds to apply for T-Bills
- Subject to CPFIS rules and bank-specific deadlines (typically earlier than cash deadlines)
- Note: CPF OA earns a guaranteed 2.5% per annum, so using CPF for T-Bills only makes sense when the cut-off yield exceeds 2.5%
What you need before applying:
- A Central Depository (CDP) account linked to your bank account
- Sufficient funds in your bank account (for cash applications) or CPF OA (for CPFIS applications)
When Will I Know If I Was Allotted?
After the auction closes, MAS publishes the results — typically the same day or the next business day. You can check results on the MAS website or through your bank's internet banking portal.
For non-competitive bids, allotment is almost always full (subject to the 40% cap). If the total non-competitive demand exceeds 40% of the issuance size, allotments are scaled down proportionally.
After allotment, the discounted purchase price is debited from your account. The full face value is credited back at maturity.
Can I Sell a T-Bill Before Maturity?
Yes — Singapore Government Securities (SGS), including T-Bills, can be sold on the secondary market before maturity through the SGS bond market via participating brokers. However:
- The price you receive depends on prevailing market rates at the time of sale
- If rates have risen since you bought, the price will be below your purchase price
- If rates have fallen since you bought, the price may be above your purchase price
- Secondary market liquidity for T-Bills is lower than for longer-term SGS bonds
Most retail investors hold T-Bills to maturity to avoid this complexity.
Are T-Bill Returns Taxable in Singapore?
T-Bill returns (the discount) are exempt from Singapore income tax for Singapore residents. This makes them tax-efficient compared to fixed deposit interest, which is technically taxable for residents (though in practice most individuals fall below taxable thresholds given Singapore's progressive tax rates).
What Happens at Maturity?
At maturity, the full face value (S$10,000 per T-Bill) is automatically credited to the bank account linked to your CDP account. No action is required on your part.
If you applied using CPF OA funds, the maturity proceeds are credited back to your CPF OA account.
T-Bills vs Other Safe Options in Singapore
T-Bills are one of several options for Singapore savers looking for low-risk instruments. Each has different characteristics:
| T-Bills | Singapore Savings Bonds | Fixed Deposits | CPF OA | |
|---|---|---|---|---|
| Issuer | Singapore Government | Singapore Government | Banks | Singapore Government |
| Tenor | 6 months / 1 year | Up to 10 years | 1 month to 5 years | No fixed term |
| Current yield (Aug 2026) | ~1.59% (6-month) | ~1.46% (Year 1) | ~1.50–1.60% | 2.50% (guaranteed) |
| Early exit | Secondary market only | Monthly, no penalty | Break clause applies | Subject to CPF rules |
| Min. investment | S$1,000 | S$500 | Varies by bank | N/A |
| Tax | Exempt | Exempt | Taxable (in theory) | Exempt |
Rates as of August 2026. Always verify current rates before making any decisions.
Where to Track T-Bill Auction Results
- MAS website (mas.gov.sg) — official source for auction results, schedules, and historical yields
- SG T-Bill Buddy (mybuddytools.com/sg-tbill-buddy) — tracks latest auction results and lets you calculate potential returns based on your investment amount
Key Takeaways
- T-Bills are short-term Singapore Government securities, available in 6-month and 1-year tenors
- They are sold at a discount and return face value at maturity — the difference is your return
- Non-competitive bids are the standard approach for retail investors
- Returns are exempt from Singapore income tax
- At current yields (August 2026), CPF OA at 2.5% still outperforms T-Bills — worth checking both before deciding where to place funds
This article is for informational and educational purposes only. It does not constitute financial advice. Always refer to official MAS and CPF Board resources for the most current information, and consider your own financial circumstances before making any investment decisions.