Category Archives: Banking

The Krisflyer UOB account has a sign up promotion, but is it worth your time?

The Krisflyer UOB account needs no further introduction for frequent readers of the site (but for those of you who are new here, take a walk down memory lane…).

The account hasn’t changed since it launched- it still offers 0 interest, it still requires you to park a ridiculous amount of money to earn anything more than 1.4 mpd (which you could just as easily earn with a regular miles card), it still caps the bonus miles you earn at a ridiculously low threshold and it’s still shelling out for influencer Instagram ads (which at least are properly tagged with #ad now, with the exception of a certain ferrous female…)

What’s new is that UOB is currently running a sign up offer of 5,000 miles with $500 of spend on the Krisflyer UOB debit card.  You need to open an account and maintain a minimum monthly average balance of $5,000.

Now, don’t get too excited- this is a UOB-style sign up promotion so as you might expect there’s all sorts of caveats. Here are the main conditions (T&C here):

Note that although you have until 31 August to sign up for an account, you need to be among the first 5,000 people to register for the promotion via SMS. The T&C suggest this promotion has been live since 8 August. How many people have registered so far? How many have hit the $500 requirement already? Who knows!

The terms state that if you’re among the first 5,000 to register, keep $5,000 MAB in your account and spend $500 on the debit card by 30 Sept, you get

  • 1,000 miles within 3 months of spending the $500
  • 4,000 miles within 3 months of 30 Sept

But there’s more. Reading the fine print reveals this additional term-

If you close your account within 9 months from the time of opening, UOB reserves the right to claw back the 5,000 miles. There’s nothing stopping you from withdrawing your $5,000 after 30 Sept, but remember that you’ll incur a $2 fall below fee if your MAB is below $1,000 and a $30 fee if you close the account within 6 months.

I value miles at 2 cents each so 5,000 miles is about $100 of value. Is that a decent return for tying up $5,000 for a month and a half (and $1,000 for 7.5 more months, assuming you don’t want to incur $18 worth of fall below fees)? Depends what your alternative is. If that money would have sat in a savings account then you’re not losing much, but that money could obviously be put to much more fruitful purposes. For the record, I’m not a fan of the 3 month timeline given in the T&C either- it seems like a long time for your miles to credit given that one of the professed perks of the account is “faster miles crediting through direct deposit”.

The main problem I have with the promotions that UOB runs is uncertainty. The way they’ve structured this (and other sign up promotions like those for the UOB PRVI Miles card) is that you have no way of knowing ex-ante whether or not the promotion has been exhausted. You have to apply for the account, spend the $500 and pray that you’re still within the first 5,000. If not, the only way you’ll know is when nothing happens. The information asymmetry is not customer-friendly. I understand UOB’s want to cap the liability incurred with each promotion, but surely there’s got to be a better way of doing it than making customers guess in the dark.

Personally I can think of much better and faster ways of earning 5,000 miles, so this one is a pass for me. But if you really need the miles and are willing to bear both the risk (of missing out on the first 5,000 registrations)  and the wait (3 months for miles crediting, 9 months for account closure), well…

Financial alternatives to UOB Krisflyer and reflections on a crash

A lot has been said in recent days about the new UOB Krisflyer account, not just on this site, but by others in the general finance space.

If I could summarize my problem with the product in one sentence, it’d be that the upside to you is capped (in the form of the 5% cap on bonus miles) while the downside to you is unlimited (in the form of 0% interest on your entire balance).

So I’ve made my stance on the matter pretty clear. Still, I’d encourage those of you who are undecided to have a read of some of the coverage on other sites like Dollars and Sense, Moneysmart and even this one piece on Bank Bazaar that tries to take an alternative viewpoint. Read up, understand the product, do your sums and come to your own conclusion.

Financial Alternatives to the UOB Krisflyer account

The only thing I want to add to this is the one piece that was missing from all my analysis- what the opportunity cost of putting your money in a 0 interest account is. I mean, I did talk about it in terms of miles, but I didn’t talk about alternative investments like fixed deposits, equities and the like.

This is because I’m terrible at investments. I mean, I collect miles for goodness sake. They don’t earn interest, they’re not insured and they can only ever be devalued. But man, the experiences you have

Fortunately, Fiona from SG Budget Babe is better at such things, and she’s kindly prepared some alternative investment options for your consideration (for the record, she was the one who gave me the heads up about the influencer posts that were going around Instagram).

I’d encourage you to have a full read over on her site, but here are the key tables for your reference. The investment options here aren’t exhaustive, of course, but they’re common financial instruments available to most investors.

I’ll discuss the 1 year investment horizon scenario here (she’s prepared a 3 year scenario on her site as well), because we’re not clear what will happen to the UOB Krisflyer earning rates after the first year promotional period, and where equities are concerned we need to make significant assumptions the further out we go.

For a 1 year investment horizon

For a 1 year investment horizon, assuming a $30K deposit and $500 card spending a month, you’d have 8,400 miles with your UOB Krisflyer account. Assuming a 2 cpm value, that’s about $168 of interest. This is slightly over half what you would get if you put it in 0 or virtually 0 risk investments like Fixed Deposits or SSBs. If you were willing to put it in a REIT, you could get significantly more (assuming, of course, you pick the right one) not just from dividends, but capital gains as well.

Even if you spend $1,000 a month, you’d be on 16,800 miles or roughly $336 of value. I realise that’s on par with the 0 risk investments, but you need to factor in the fact that miles are a non-liquid currency. In any case, I’m going to fall back on my thesis statement made elsewhere that if you’re after miles, there are better cards for getting them.

Reflections on a crash

On another note, The Milelion had a server outage that started intermittently around 9 or 10pm last night and escalated into a full website crash all the way until 10.45am this morning.

I am clueless about IT issues (I’ve barely poked around my back end, fnar fnar) and in the space of time between I woke up at 6am to full restoration, I had to learn a lot of acronyms I’d rather not know like CDN, DDOS, TOS, DNS…

Suffice to say, the diagnostics showed the crash was due to a spike in CPU usage beyond which my hosting plan allowed. This caused the hosting platform to suspend access to the site until it was optimized. This has since been done and regular services resumed. I’ve also upgraded the site’s security to prevent a future recurrence.

I don’t have enough technical knowledge to say whether this spike was because of the sheer number of visitors (we crossed 50K yesterday (and imagine what that would have been without the outage!), compared to the usual 3-4K) or whether it was caused by something malicious, and it would be irresponsible to speculate (Russians!).

But I do thank all of you who reached out to let me know something was up, and the others who offered to put me in touch with IT people/other hosting services who could help me resolve it. It means a lot to me that you’d go out of your way to render help to someone you met on the interweb.

Group hug y’all.

Image result for grouphug

It’s quite incredible how the past 7 days started with the excitement of what seemed to be a game changing product, turned to disappointment when the fine print was revealed, turned to ridicule at the defense raised by the bank, turned to anger at the influencers involved in promoting a product they clearly knew nothing about.

But let’s face it- this will eventually fade. UOB will have future product launches. Some will be good, some will be bad. Influencers will continue to promote products. Some will be good, some will be bad.

What is important to me is that The Milelion and its guestwriters continue to call things as we see them, and maintain the highest standards of ethics in our writing.  I was very moved by the support in the comments section of the influencer article, and will work tirelessly to keep the trust you guys have placed in this site.

Group hug again.

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So keep reading, keep questioning, and keep taking part in the comments and FB discussions. Let’s make this a place where anyone can learn to travel better for less.

An open letter to the influencers who promoted the Krisflyer UOB account

Dear fellow influencers,

I’m glad you’re all as excited about the new Krisflyer UOB account as I am. I mean, why else would you all have, in a coordinated and synchronized manner, simultaneously posted Instantgram posts on the very day the UOB Krisflyer account was launched?

I have to admit, I feel really noob reading all your posts. After all, you guys take better photos than me, have more aesthetically  pleasing bodies than me and also got more followers than me. Staring at your followers list makes me feel like proverbial urchin staring through shop window on cold Christmas eve.

Now, because none of these posts were tagged #sponsored, #ad, #advertorial, or #theypaidmeinsmallunmarkedbills, I must assume that these are all impartial reviews based on your personal experiences with the product. Therefore, I am genuinely concerned that you guys are missing out on some of the best opportunities to earn miles.

Fortunately, I can help you here! I’ve done some research on the account and while I feel that the overall idea is definitely innovative, there are things that could potentially be improved on. I really hope that UOB takes notice of these and makes some changes so that a great idea doesn’t get let down by poor execution.

Hope this helps!


Dear ladyironchef

I love your food porny posts and the way you introduce to me new restaurants all the time. You’re the reason I haven’t seen my feet in years and have the turning radius of a small van. And am currently going to die alone.

However, it seems like you are paying for your restaurant expenses with the UOB Krisflyer debit card. I think this is a mistake. You see, you could easily be earning 4 mpd on all your local dining and online expenses with the HSBC Advance cardwithout cap, all the way until 31 May 2017!

Yes, I know the card is a bit of a pain in the butt to get, but trust me, when you’re earning unlimited 4 mpd without an arbitrary 5% cap and a chunk of money earning 0 interest in the bank, it is the most shiok feeling ever. More shiok than when the Sin Huat crab beehoon uncle actually treated me with dignity and respect and never try to upsell me. Happy days man.

But what happens after 31 May, you ask? Well, we can hope that HSBC, from the kindness of their hearts, decides to extend this promotion again as they have done time and time again in the past. But if they don’t, you might fancy gambling and applying for the UOB Preferred Platinum AMEX and hope they take your application, failing which you could get the Maybank Horizon Visa Signature card which gives 3.2 mpd on dining. Not as good as 4 mpd, of course, but might be better than parking funds in a 0 interest account.


Dear melissackoh

I love your posts because your photo skills really zai. Every time I see your posts I wonder why I must use Blackberry camera to take all my photos. Then I remember that blur out of focus bokeh is the new black(berry). Ha ha ha!

In your post you implied your trip to Sydney was made possible thanks to the UOB Krisflyer account. I am excited because I also want to go Sydney and see koalas boxing wallabies, which I hear is on the national flag.

Now, it takes 56,000 Krisflyer miles for a round trip Economy saver award between Singapore and Sydney.

If you have $3K-$100K in your Krisflyer UOB account (let’s take $51.5K as the middle value), you’d be earning 1.4 mpd, the bonus component of which (1 mpd) is capped at 2,575 (5% of $51.5K) per month.

To earn those 56,000 miles, you’d need to spend $5,250 a month for a year on your Krisflyer UOB debit card (25,200 base miles, 30,900 bonus miles- remember, bonus is capped at 2,575 a month!) for a total outlay of $63,000

But assuming you spent an average of 30% on dining out, 30% on online shopping and 40% on everything else, with the right card strategy (HSBC Advance + DBS Woman’s World/Citibank Rewards + UOB PRVI Miles) you could get a weighted average of 0.3*4 +0.3*4 +0.4 *1.4= 2.96 mpd! This means you’d only have to spend <$19K in a year to get that Sydney trip!

Plus, you’d be able to put that $51.5K to work for you in koalas boxing wallabies futures. I hear the return on that is non-zero.

Obviously, the equation changes if you have 100k+ in your account, but if you are parking $100K+ without interest in the bank, please let me know who your influencer agency is because mine is clearly not doing its job properly.

BTW, please don’t go to Pancakes on the Rocks. Last time I was in Sydney everyone told me that was THE place to go to, but I thought it was super average. This is why I don’t like people.


Dear bellywellyjelly

I love your travel posts. Super bohemian one. I wish my Bangkok trips could be as awesome as yours but I am scared of new experiences so every time I go it’s Paragon–>Roast–>After You–>Patpong–> Emporium

(EDIT: Posts have since been updated with #ad tags)

In one of your posts, however, you mentioned this-

Here’s a tip, use the #KrisFlyerUOB Account on your fav budget airlines Scoot & Tigerair to get complimentary additional baggage allowance plus FREE seat selection and more 😉 (got you covered here)

Don’t worry! Bro got you covered too!

You might like to know that your complimentary additional allowance  (5kg) only applies if you buy a minimum of 20kg luggage allowance. And you need to buy this 20kg at the time of booking, not after! If you buy after, hard luck.

Also, you talked about complimentary seat selection. I am balding and have bad BO, so no one wants to travel with me. But if you travel with your friends, you need to know that only the principal cardholder gets free seat selection, even if the other travelling parties are on the same booking.

PS- I’m a bit confused, because from the way you’ve written your post…

Scratched this off my bucket list on my trip with #KrisFlyerUOB, the first debit card & account in Singapore. 

…it kind of makes it sound like you’ve already been able to travel with the miles you got from this account. Which is quite impressive given that it was only launched a few days ago, and (assuming your situation matches melissackoh’s) you’d have had to have spent ~S$56K to get the 25,000 miles you need for a round trip economy saver (you see your bonus 1 mpd is capped at 2,575 miles each month, meaning you’d have to earn the remainder 22,425 miles at 0.4 mpd)

Moreover, as per the T&C of the UOB Krisflyer debit card, any miles earned only get credited to your Krisflyer account at the end of the month. And it’s only 24th April. If you have lobang for faster miles crediting, please share ok?


Dear thetravelintern

Hope you guys are doing well. I liked that quote by Eleanor Roosevelt you shared- “Do one thing every day that scares you.” This morning I tried using 1 ply toilet paper instead of my usual 2. Don’t want to tell you how that went but the important thing is I tried.

You guys mentioned this in one of your posts-

Great travel perks such as free seat selection and convenience fee waiver when booking flights — no more additional charges to deal with while planning your next big adventure

Regarding the free seat selection- see the advice I gave bellywellyjelly. Regarding convenience fee waiver- take care guys. I know it sounds good but you need to spend a minimum of S$250 on a Scoot/Tigerair booking on a single transaction first. Then you’ll get a fee waiver voucher that can be used on your next booking.

So technically, you should be saying “no more additional charges to deal with while planning your next next big adventure”.  Also, be aware that you get a maximum of one waiver a year per account yeah?

You guys say the Krisflyer UOB debit card is helping you achieve your travel dreams. Let me see if I can help you out there- it takes 25,000 miles to go to Laos in economy saver on Silkair. Assuming the same figures I gave to melissackoh, you would need to spend $1,500 a month, or $18,000 a year to get the miles you need (7,200 base, 18,000 bonus).

But if you used my recommended card strategy @ 2.96 mpd, you’d only need to spend ~$8.5K! Anyway guys, I recommend you save your Krisflyer miles for long haul redemptions. You could get to Laos for <S$400 return trip with budget airlines.


So that’s my advice!

My fellow influencers, let us continue to maintain the highest standards of transparency and miles earningness. Without us, the public is lost.

Excelsior!
The Milelion