Chin Yi Xuan

Versa Cash Review: A Great Alternative to Fixed Deposit (FD)!

Fixed Deposit, or FD, has always been people’s go-to way to save or deposit extra cash. The problem is, it locks your money in for a long period of time, or requires a high initial deposit to start with.

In this article, let’s look into Versa Cash, a great alternative to FD in Malaysia. Personally, I've been using Versa Cash since 2021 and I absolutely love it! In this post, let's explore if Versa is for you! 

[NEW: Get 4% promo return rate with Versa Cash starting 1/11/2022! Find out more at the end of this post!]

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Highlights of Versa Cash

Established in 2021, Versa Cash is a digital cash management service that provides users competitive returns like FD, but without the troublesome restrictions:

• Regulated: Versa is regulated by the Securities Commission (SC) of Malaysia.
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• Competitive Return: Through Versa, users can earn a projected rate of 2.5% interest per annum, which is on-par with the rates of Fixed Deposit (FD).
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• Low Risk: The underlying fund of Versa is the Affin Hwang Enhanced Deposit Fund. It is a money market fund that invests users’ money in highly liquid & low-risk cash instruments.
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• Flexible & Low Barrier of Entry: Malaysians aged 18 and above can start saving or investing via Versa from as low as RM1. Withdraw anytime without being charged penalty fees.

How does Versa Cash work?

So, how exactly is Versa Cash able to deliver returns that are on-par with FD?

This is possible because Versa helps invest users’ cash into money market funds (MMF). MMFs are funds that invest in Fixed Deposits and highly liquid, short-term cash equivalent instruments called Money Market Instruments.

Essentially, Money Market Instruments are short-term debts issued by banks in order to accumulate short-term cash-pile to make up for the shortfall in their daily deposit reserve. Simply put, MMFs are lending money to banks when they buy these Money Market Instruments.  

These instruments are relatively low-risk as they are backed by the banks. Moreover, they are highly liquid with short maturity periods. Through regular redemption of matured Money Market Instruments, it allows MMF to provide a similar rate to FDs without having to lock up users’ capital.

For Versa, the underlying MMF that they invest in is the Affin Hwang’s Enhanced Deposit Fund. It is a low-risk MMF by Affin Hwang Asset Management.

In short, through Versa Cash, you can earn a similar rate to FD through low-risk MMF without having to lock up your funds, unlike conventional FDs. It is a great choice if you are looking for a competitive and flexible alternative to FDs.

Is Versa Cash Safe to Use?

When it comes to regulation, Versa is regulated by the Securities Commission (SC) of Malaysia. This ensures that Versa is always operating in Malaysia as per the guideline from the local authority. 

As for the safety of funds, the cash deposits from users are held by a third party (trustee), which is HSBC (Malaysia) Trustee.

In other words, your deposits to Versa are separate from Versa’s company finances. As such, this ensures no deposits can be used for fraudulent purposes and you will always have full access and claim to them no matter what happens to Versa.

Versa Cash Fees & Charges

As a digital cash management platform, Versa Cash does not charge a fee to users. That said, the underlying MMF, Affin Hwang’s Enhanced Deposit Fund, does charge reasonable annual fees, as shown below:

Next question: Are there any fees on fund withdrawal via Versa?

Unlike FDs, there are no charges when you withdraw your funds from Versa. Withdrawals are expected to be reflected within 1-2 business days depending on the time of withdrawal (ie. before or after 2:30pm during business days).

At this point, perhaps a question that you have in mind is “So how does Versa make money?”.

Aside from Versa Cash (which is free to use), Versa also offers investment services via Versa Invest. Through Versa Invest, Versa will charge a small management fee which is their key income source. 

READ MORE: Versa Invest Review

3 things I like about Versa Cash

#1 Performance on par with conventional Fixed Deposits (FDs)

Through Versa, interests are compounded daily and interest payout is made every month, which is re-invested into user’s fund.

All of this combined, through its underlying Affin Hwang Enhanced Deposit Fund, Versa projects about 2.5% return per annum (AFTER fees) for users.

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#2 Flexible & Low barrier of entry

2 amazing features about Versa are:

1. Low barrier of entry: You can start investing or saving with Versa from as low as RM1. Even better, using my exclusive referral code VERSANML3, you can get RM10 credited into your Versa account when you make a minimum deposit of RM100!
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2. Flexible: There are no charges to open a Versa account. In addition, you can withdraw your funds anytime and there are no fees on withdrawal.

Combined, both these features make a compelling edge against conventional FDs. Reason being, FDs usually have higher minimum deposits & they tend to lock in users for a period of time (and charge a penalty for early withdrawals).

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#3 Simple & clean user experience (suitable even for my retired mom!)

Perhaps my favorite experience with Versa is their simple and clean user interface.

As a simple digital cash management platform, I enjoy the design of the app that clearly shows the capital invested and payout.

In fact, when my retired mom was looking for a better FD alternative to save her idle cash, I recommended Versa without hesitation. This is because I know she can totally navigate the app with clarity & confidence.

Risks + What You Need to Know Before Investing in Versa Cash

In this part, let’s look at 3 things that you need to be aware of while investing your money with Versa:

1. Market risk

While being a relatively stable investment, investing in Money Market Fund (MMF) via Versa still presents exposure to market risk.

One such risk is the fluctuation in interest rate. As an example, if Bank Negara Malaysia (BNM) increases interest rate, MMF is likely going to generate higher returns. On the flip side, if BNM reduces interest rate, it’ll also affect the returns of MMF as a result. 

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2. Not protected by PIDM

While investing in Versa, it is important to remember that your fund is not protected by Perbadanan Insurans Deposit Malaysia (PIDM).

PIDM is an organization that protects deposits kept in banks and financial institutions that are a member of PIDM. Conventional bank FDs are usually protected by PIDM.

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3. Not shariah-compliant

In addition, Versa’s underlying MMF, Affin Hwang Enhanced Deposit Fund is not shariah compliant.

Hence, this is something that you need to be aware of prior to investing with Versa.

Improvement: ONE Feature Versa HAS to Add

As a Versa user myself (also having opened an account for my mom), there is one handy feature that I think Versa Cash lacks: Automatic Scheduled Transfer.

Being a digital cash management platform, I think having the convenience for users to automate their deposits every week/month should be a fundamental feature.

While I enjoy using Versa, I think this improvement will make Versa a more complete financial app.

Eligibility + Is Versa Cash for You?

Versa is open to Malaysian citizens who are 18 years old and above with an NRIC/MyKad. This means that even young Malaysian adults can start building good financial habits by saving/investing from their phones – neat!

That said, is Versa for you?

To answer this question, it is best to first know what Versa is NOT:

• Versa Cash does not invest in stocks/equities (ie. Higher risk assets). Hence, do not expect mutual fund/robo-advisors-like returns.
• Versa Cash does not guarantee returns. Even though it invests in low-risk MMF, returns are still subjected to market fluctuation.

Hence, in my opinion, Versa Cash is great for:

1. People looking for a flexible alternative to FD & typical savings account for general savings
2. People looking to save for a specific goal (eg. house, car, wedding)
3. People with extra cash and want to save it for the short-term

Versa Promo Code: VERSANML3

In collaboration with Versa, No Money Lah is bringing an exclusive deal for new users that are keen to start saving or investing with Versa!

Use my dedicated Versa referral code – VERSANML3, and you will get RM10 credited into your account* when you successfully make a minimum deposit of RM100 or more. That’s an instant 10% return on your investment.

Open a Versa account today!

How to open a Versa Account

Creating a Versa account is simple and straightforward:

Step 1: Click HERE to install the Versa app.

Remember to apply referral code 'VERSANML3' for an exclusive RM10 account-opening reward!

Open a Versa account today!

Step 2: Start your account opening process by keying in the necessary details such as a new display name, email address, and password. 

Step 3: You’ll go through a simple identification process where you’ll be asked to verify your mobile number, IC, and personal details. This is a required process by the regulators to make sure it’s the real you that’s opening an account.

Step 4: It’ll take about 2-3 business days to verify your account. Once that’s done, you can start investing in Versa by making your first deposit!

Versa or StashAway Simple or KDI save?

In terms of offering, Versa’s closest competitor is certainly KDI Save and StashAway Simple. Both offer users flexible and low-barrier access to MMF that pays competitive FD-like rates.

I think this comparison deserves a full article on its own so I’ll attach a link HERE when I come out with a comparison article real soon! 

Personally, I use both Versa, KDI Save, and StashAway Simple to save for different purposes and I am happy with them as an alternative to FD (I think you will, too!).

READ: The Ultimate FD-Killer Showdown: StashAway Simple vs Versa vs KDI Save vs TNG Go+ vs BEST Invest!

[LIMITED-TIME PROMO] Get 4% return on your savings via Versa Cash!

Looking to get more out of your cash? From 1/11/2022 - 31/1/2023, all Versa Cash users are eligible for a promotional rate of 4% on their cash!

How it works:

1. Versa Cash's 4% promotional rate is applicable to all new & existing Versa Cash users.
2. The promotional rate is automatically applied to the first RM30,000 in your Versa Cash account. Any subsequent balance above RM30,000 will continue to earn Versa Cash’s base net return rate of 2.5% p.a.
3. Promotional period: 1/11/2022 - 31/1/2023
4. Refer to the full T&C for more info.

I think this is GREAT news if you are looking for a higher rate for your savings! Remember, there is no lock-in period for Versa Cash and you are free to withdraw your funds anytime!

Open a Versa account today!

No Money Lah’s Verdict

So there you have it, my review on Versa! If you are looking for an FD alternative to invest/save your cash, Versa is a platform that I can wholeheartedly recommend you to try.  

Personally, I enjoyed using the platform and I think you will, too! 

Open a Versa account today!

Disclaimers

Investment in a money market fund is not the same as placement in a deposit with a financial institution. There are risks involved and investors should consult a financial planner before making any investment decisions.

This post contains affiliate links/code that afford No Money Lah a small amount of commission (and help support the blog) should you sign up through my affiliate link/code.

by Chin Yi Xuan

KDI Save Review: Get 3.5% return on this FD killer!

Are you looking for a better alternative to save your money other than conventional Fixed Deposits (FD)?

In this post, let’s explore KDI Save – the latest and best alternative to FD in town!

As always, if you like this post, consider subscribing to my FREE newsletter and be the first to receive updates on my content! 

[UPDATE: As of October 2022, KDI Save has raised its promotional rate from 3% to 3.5% Effective Annual Rate (EAR). Definitely the best choice to save your cash right now!]

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What is Kenanga Digital Investing (KDI)

KDI is a new suite of services offered by Kenanga Investment Bank. There are 2 key offerings, namely:

• KDI Invest: A new 100% AI-powered new robo-advisor that helps you invests in Exchange-Traded Funds (ETFs) based on your risk preference.
• KDI Save: A flexible cash management fund that places your money in low-risk instruments to generate returns on-par to FD.

I’ll cover both offerings separately. In this post, let’s focus primarily on KDI Save.

Highlights of KDI Save

If you are looking for a flexible alternative to FD, KDI Save is a great choice:

• Returns: KDI Save offers a promotional return rate of 3.5% Effective Annual Rate (EAR) up to RM50k, followed by 3% (>RM50k to RM200k), and a base rate of 2.5% thereafter. Interests are paid out and compounded daily.
• Fees: FREE – no charges on your deposits.
• Low barrier of entry & Flexible: Low initial deposit of RM100 (min. RM10 thereafter) + No lock-in period, withdraw anytime without penalties.
• Regulation: Kenanga Digital Investing (KDI) is a financial initiative from Kenanga Investment Bank. It is regulated by the Securities Commission Malaysia (SC).

How does KDI Save work?

So, how exactly is KDI Save able to deliver returns that are on-par with FD?

All of this is possible because KDI Save invests users’ money in short-term Fixed Deposits (FD) and Money Market instruments.

Essentially, Money Market Instruments are short-term debts issued by banks. This helps banks to accumulate short-term cash-pile to make up for the shortfall in their daily reserve. Doing so, banks pay out a small interest to the party that invests in their Money Market Instruments.

These instruments are relatively low-risk as they are backed by banks. Moreover, they are highly liquid with short maturity periods. Through regular redemption of matured FD and Money Market Instruments, it allows KDI Save to provide a similar rate to FDs without having to lock up users’ capital.

KDI Save Features & Returns

#1 Fixed 3.5% Effective Annual Rate (EAR)

The 3.5% EAR from KDI Save is certainly the most attractive aspect of KDI Save.

Reason being, the rate is highly competitive compared to conventional Fixed Deposits. In fact, it is (much) higher than Maybank’s 60-month FD rate!

That said, do note that the EAR is tiered, as of below:

The promotional rates are valid only for a limited period of time, though there is no mention of when it'll end on KDI's website. I've written in and confirmed that there is no specific end date for this promotion for time being.

#2 Withdraw anytime without penalty charges

Even better, with KDI Save, you have the flexibility to withdraw your money whenever you want – without any charges. This is unlike conventional FD that locks in your money, imposing penalty charges if you were to withdraw earlier.

#3 Low barrier of entry

The minimum initial deposit for KDI Save is RM100. Then, the subsequent minimum deposit is RM10.

As a whole, this made KDI Save a solid choice if you are looking to save your money at a competitive rate, without sacrificing the flexibility on when to use the money.

KDI Save Fees

Here’s another good news:

It is 100% FREE to save your money on KDI Save. Meaning, there are no management fees or sales fees that we commonly see in unit trusts.

In other words, you get the full 3.5% promotional rate return without additional cost.

Regulation & Safety of funds:

Regulation:

When it comes to regulation, KDI Save is regulated by the Securities Commission Malaysia (SC). This ensures that KDI Save is always operating in Malaysia as per the guideline from the local authority.

Safety of Funds:

As for the safety of funds, the cash deposits from users are held by a third party (trustee), which is Pacific Trustee Berhad.

In other words, your deposits to KDI Save are separate from KDI’s company finances. As such, this ensures no deposits can be used for fraudulent purposes and you will always have full access and claim to them no matter what happens to KDI.

Risk + What you need to know before investing in KDI Save

In this part, let’s look at 3 things that you need to be aware of while investing your money with KDI Save:

#1 Market risk

While being a relatively stable investment, investing in Money Market Instruments via KDI Save still presents exposure to market risk.

One such risk is the fluctuation in interest rates. As an example, if Bank Negara Malaysia (BNM) increases interest rate, KDI Save is likely going to generate higher returns. On the flip side, if BNM reduces interest rate, it’ll also affect the returns as a result.

Of course, this is applicable after KDI Save’s 3.5% return rate comes to an end on 31^st December 2022.

#2 Not protected by PIDM

While investing in KDI Save, it is important to remember that your fund is not protected by Perbadanan Insurans Deposit Malaysia (PIDM).

PIDM is an organization that protects deposits kept in banks and financial institutions that are a member of PIDM. Conventional bank FDs are usually protected by PIDM.

#3 Not shariah-compliant

In addition, both KDI Save & KDI Invest are not shariah compliant.

Hence, this is something that you need to be aware of prior to investing with KDI.

Eligibility + Is KDI Save for You?

KDI is open to Malaysian citizens & PR who are 18 years old and above with a Malaysian bank account.

That said, is KDI Save for you?

To answer this question, it is best to first know what KDI Save is NOT:

• KDI Save does not invest in stocks/equities (ie. Higher risk assets). Hence, do not expect mutual fund/robo-advisors-like returns.
• KDI Save does not guarantee returns. Even though it invests in low-risk Fixed Deposits & Money Market Instruments, returns are still subjected to market fluctuation.

Hence, in my opinion, KDI Save is perfect for:

• People looking for a flexible alternative to FD & typical savings account for general savings
• People looking to save for a specific goal (eg. house, car, wedding)
• People with extra cash and want to save it for the short-term

KDI Invest Referral Code: 101183

In collaboration with Kenanga Digital Investing, No Money Lah is bringing an exclusive deal for new users that are keen to start using KDI Invest!

Use my dedicated KDI referral code – 101183, and you will get RM10 credited into your KDI Invest portfolio* when you successfully make a minimum deposit of RM250 on KDI Invest.

*Note: RM10 credit will be made within 30 days upon successful verification & deposit.

Open a KDI account today!

How to open a KDI Account

Creating a KDI account is simple and straightforward:

Step 1: Search and install the KDI app via Playstore or Appstore. Alternatively, you can also install KDI Save via my referral link by clicking on the button below:

Open a KDI account today!

Step 2: Start your account opening process by keying in the necessary details such as email address, and password.

Remember to apply referral code 101183 for an exclusive RM10 account-opening reward!

Step 3: You’ll go through a simple identification process where you’ll be asked to verify your phone number, email, IC, and personal details. This is a required process by the regulators to make sure it’s the real you that’s opening an account.

Step 4: When you register for a KDI account, you’ll have access to both KDI Invest and KDI Save. Select a risk profile for your KDI Invest portfolio – don’t worry you can always change your risk profile anytime after account opening.

Step 5: It’ll take about 2-3 business days to verify your account. Once that’s done, you can start investing in KDI Save or KDI Invest by making your first deposit!

KDI Save vs Versa vs StashAway Simple

In terms of the offering, KDI Save’s closest competitors are certainly Versa and StashAway Simple. Each platform offers users flexible and low-barrier access to Money Market Instruments that pay competitive FD-like rates.

KDI Save is certainly an attractive offering with its EAR of 3.5%.

For a detailed comparison (deposit/withdrawal speed, fund comparison), check out my full comparison article below!

Personally, I use all platforms to save for different purposes and I am happy with both of them as an alternative to FD (I think you will, too!).

READ: Comparison - KDI Save vs StashAway Simple vs Versa

No Money Lah’s Verdict

So there you have it, my review on KDI Save! If you are looking for an FD alternative to invest/save your cash, KDI Save is a platform that I can wholeheartedly recommend you to try.

Personally, I enjoyed using the platform and I think you will, too!

by Chin Yi Xuan