A time deposit is one of the simplest ways for Filipinos to earn more interest than a regular savings account without touching the stock market — you agree to leave a lump sum untouched for a fixed period, called a tenor, in exchange for a locked-in interest rate. It's a common next step for people who've built up savings beyond their emergency fund and want it to grow a little faster while staying fully protected by PDIC deposit insurance. This guide walks through exactly how to open one, what it actually costs you in taxes today, and how to avoid the most common first-timer mistakes.
You open a time deposit by choosing a bank, picking a tenor between 30 and 360 days, meeting the minimum placement (often ₱1,000–₱10,000), and submitting one valid government ID either at a branch or through the bank's app.
- Most Philippine banks let you open a time deposit with as little as ₱1,000 to ₱10,000, either at a branch or through their mobile app
- PDIC insures time deposits up to ₱1,000,000 per depositor per bank, a limit that was raised from ₱500,000 in March 2025
- Since July 1, 2025, RA 12214 (CMEPA) imposes a flat 20% final withholding tax on ALL time deposit interest regardless of how long you keep the money in — the old 5-year tax-free holding period no longer exists
- Digital banks like Maya and CIMB often advertise higher promotional rates than traditional banks, but always confirm the live rate before placing your money
- Withdrawing before the maturity date usually forfeits some or all of the interest you would have earned, so match the tenor to money you genuinely won't need
Step 1: Decide How Long You Can Leave the Money Untouched
Before picking a bank, figure out your tenor — the fixed length of time your money stays locked in. Philippine banks commonly offer 30, 60, 90, 180, and 360-day tenors, though some products range as narrowly as 35 days or as long as 364 days depending on the bank. The tenor you choose should match money you're genuinely confident you won't need, because pulling funds out early (called pre-termination) usually means forfeiting some or all of the interest you would have earned, and some banks charge an additional penalty on top.
A practical rule for first-timers: start with a 30 or 90-day tenor for your first placement so you can see exactly how the interest crediting and maturity process works before committing larger amounts to a longer term.
Step 2: Compare Minimum Deposits and Rates Across Banks
Minimum placement amounts vary by bank. BDO's peso time deposit starts at ₱1,000, while several digital banks set their floor around ₱10,000. Traditional banks like BDO, BPI, and Metrobank typically tier their interest rates by both deposit amount and tenor — larger, longer placements generally earn a higher rate — while banks publish these tiers on their own rate sheets, which change periodically, so always check the live rate on the bank's official page rather than relying on an old screenshot or a friend's rate from months ago.
Digital banks have been competitive on headline rates: Maya's Time Deposit Plus has advertised rates up to 6.0% per annum, and CIMB has run promotional time deposit rates in a similar range on 6, 12, and 24-month tenors. These promotional rates can beat traditional banks by a wide margin, but they're also more likely to change with market conditions, so confirm the exact rate at the moment you're about to place your money, not from a months-old promo you saw online.
Step 3: Prepare One Valid ID and, Ideally, Your TIN
To open a time deposit as a resident Filipino citizen, banks generally require one primary government-issued ID — a passport, driver's license, PRC ID, UMID, or the PhilSys national ID — or two secondary IDs if you don't have a primary one on hand. Non-resident foreign nationals typically need a passport or ACR I-Card instead.
Banks also commonly ask for your Tax Identification Number (TIN) during account opening, since interest income from your time deposit is subject to withholding tax (see Step 6). If you don't have a TIN yet, you can still open most accounts, but having it ready speeds up the process and avoids a follow-up request from the bank later.
Step 4: Choose Branch or Online/App-Based Opening
You can open a time deposit two ways. The traditional route is visiting a branch, meeting with a customer service representative, filling out the account opening form, presenting your ID, and funding the deposit either in cash or by transfer from an existing account at the same bank. This still tends to be the more reliable route for larger, first-time placements since you can ask questions about the specific rate tier in person.
Increasingly, banks support opening a time deposit entirely through their mobile app — BPI, UnionBank, Maya, GCash, and CIMB all support some form of digital time deposit opening, often letting you upload a photo of your ID or PhilSys ePhilID and fund the placement instantly from your existing e-wallet or savings balance. This is usually the faster route once you already have an account with that bank.
Step 5: Understand PDIC Deposit Insurance Coverage
Every time deposit at a PDIC-member bank is automatically insured — you don't apply for this coverage separately, it's built into every account. As of March 15, 2025, the Maximum Deposit Insurance Coverage (MDIC) was raised from ₱500,000 to ₱1,000,000 per depositor, per bank. This covers your combined balance across savings, checking, and time deposit accounts at that specific bank — not per account, but per depositor per bank.
If you're placing more than ₱1,000,000, consider splitting the amount across two or more separate banks so the full sum stays within PDIC's insured limit at each institution. Note that PDIC coverage applies to deposit products only — it does not cover investment instruments like UITFs, mutual funds, or bonds, even if a bank sells those alongside its deposit products.
Step 6: Know the Current Tax Rate on Your Interest — This Changed in 2025
Every peso of interest your time deposit earns is subject to a final withholding tax, meaning the bank deducts it automatically before crediting your interest — you never have to file or pay this separately. As of July 1, 2025, Republic Act No. 12214, the Capital Markets Efficiency Promotion Act (CMEPA), set this at a flat 20% on all interest income from peso and foreign-currency bank deposits, deposit substitutes, and trust funds, regardless of how long you keep the deposit placed.
This is an important change from the old rule: before CMEPA, interest tax used to scale down the longer you held a deposit, dropping to 0% if you kept a long-term deposit or certificate for 5 years or more. That 5-year tax exemption no longer applies to new time deposits opened today — CMEPA repealed it. If you've read older articles or heard advice mentioning a '5-year tax-free time deposit,' that information is now outdated. The only depositors still exempt are those holding a previously issued, still-valid Tax Exemption Ruling or Certificate of Tax Exemption from the Bureau of Internal Revenue — a narrow legacy case, not something available to a new depositor opening an account today.
Step 7: Calculate What You'll Actually Take Home After Tax
Because of the flat 20% final withholding tax, your effective take-home interest is always 80% of the quoted gross rate. For example, if a bank advertises a 3% per annum rate on a ₱100,000 placement held for a full year, your gross interest would be ₱3,000, but after the 20% withholding tax, you'd actually receive ₱2,400. Always do this quick 80% calculation yourself when comparing offers, since some banks and promotional ads emphasize the gross rate without spelling out the after-tax figure.
This also means the gap between traditional bank rates (often under 3%) and promotional digital bank rates (sometimes 6% or higher) is even more meaningful after tax — a 6% gross rate nets you roughly 4.8% after withholding, nearly double a 3% gross rate's 2.4% after-tax yield.
Step 8: Watch the Maturity Date and Decide on Renewal
Time deposits typically come with an auto-renewal or roll-over option that you can accept or decline when you open the account. If you choose auto-renewal, your bank automatically reinvests your principal (and sometimes the earned interest) into a new term at the maturity date, using whatever rate is current at that time — which may be different from your original rate. If you decline auto-renewal, the full amount, principal plus after-tax interest, is credited to your linked savings or checking account on the maturity date, and you decide from there whether to reinvest.
Mark your maturity date somewhere you'll actually see it — many banks send an SMS or app notification a few days before, but it's worth confirming this reminder is active when you open the account, especially if you're relying on that cash for a specific near-term goal.
Frequently Asked Questions
It depends on the bank. BDO's peso time deposit can be opened with as little as ₱1,000, while several other banks and most digital banks set a higher floor, commonly ₱10,000. There's no single minimum across the industry, so check the specific bank's current rate sheet or app before assuming a figure — some banks also offer separate, higher minimum tiers that unlock better interest rates.
Yes, up to the insured limit. Every time deposit at a PDIC-member bank is automatically covered by deposit insurance up to ₱1,000,000 per depositor per bank, a limit that was raised from ₱500,000 in March 2025. If your combined deposits at one bank exceed that amount, the excess isn't covered, so spreading larger sums across multiple banks keeps the full amount insured.
As of July 1, 2025, all time deposit interest is taxed at a flat 20% final withholding tax under RA 12214 (CMEPA), regardless of how long you hold the deposit. The bank deducts this automatically before crediting your interest, so you never file anything separately. This replaced the old rule where interest tax used to drop to 0% after holding a deposit for 5 years or more — that exemption no longer exists for new deposits.
Most banks allow early withdrawal, called pre-termination, but you'll typically forfeit some or all of the interest you would have earned, and some banks apply an additional penalty fee on top. Because of this, only place money you're confident you won't need before the maturity date — a time deposit isn't meant to function as an emergency fund you can pull from freely.
Rates change frequently and vary by deposit amount and tenor, so there's no single fixed answer. Digital banks like Maya and CIMB have advertised promotional rates as high as 6% per annum on certain tenors, often well above traditional banks like BDO, BPI, or Metrobank on standard tiers. Always confirm the live, current rate directly on the bank's official site or app immediately before placing your money, since promotional rates are frequently time-limited.
It's not always a strict requirement to open the account, but banks commonly ask for your Tax Identification Number because your interest income is subject to withholding tax. If you don't have one yet, most banks will still let you open the account, though having your TIN ready avoids a follow-up request and speeds up processing, especially for larger placements.
You typically choose at account opening whether to auto-renew or not. If auto-renewal is on, the bank reinvests your principal into a new term automatically using whatever rate is current at that time, which may differ from your original rate. If you decline auto-renewal, your full principal plus after-tax interest gets credited to your linked account on the maturity date, and you decide separately whether to reinvest.
Yes, non-resident foreign nationals can generally open a time deposit at Philippine banks, though the ID requirements differ slightly — banks typically ask for a passport or Alien Certificate of Registration (ACR) I-Card instead of the primary IDs used by resident citizens. Specific documentary requirements can vary by bank, so it's worth calling ahead or checking the bank's website for its foreign-national account opening policy.
Conclusion
Opening a time deposit in the Philippines is a straightforward, low-risk way to earn more than a regular savings account while staying fully covered by PDIC insurance up to ₱1,000,000 per bank. The two things that trip up first-timers most are forgetting that pre-termination forfeits interest, and assuming an old 5-year tax-free rule still applies — it doesn't, since every time deposit today is taxed at a flat 20% regardless of tenor. Compare a few banks' current rates, match your tenor to money you won't need soon, and you'll have your first time deposit open in under an hour.
