However, 70% are still familiarising themselves with SORA-pegged products.
Singapore consumers and corporates appreciate the stability of Singapore Overnight Rate Average (SORA)-based interest rates, according to a recent United Overseas Bank (UOB) survey. as over six in 10 property loan customers said they were open to choosing SORA-pegged products,
Respondents to the survey said the certainty, transparency, and stability of the reference rate of their loan were the key considerations when choosing a loan package.
However, 70% said they would only apply for one within six to 12 months of the product becoming available, as they would still need to familiarise themselves with SORA-pegged products.
Financial institutions, including banks, will cease to reference the Swap Offer Rate (SOR) in new products by the end of April this year, and will actively help their customers with legacy SOR contracts to transition to SORA.
UOB head of group retail Eddie Khoo said that the firm has been working closely with the industry on Singapore’s transition to the new reference rate SORA, with their SORA-pegged property loans set to help customers adopt more SORA-based financial products.
“We understand consumers and small- and medium-sized enterprises want transparency and stability in the reference rate of their loan packages as this helps them plan their finances better,” Khoo said.